ORGANIZATIONAL Managing
People and
TWELFTH
EDITION
BEHAVIOR Organizations
Ricky W. Griffin
Jean M. Phillips
Stanley M. Gully
Texas A&M University
Pennsylvania State
University
Pennsylvania State
University
Australia • Brazil • Japan • Korea • Mexico • Singapore • Spain • United Kingdom • United States
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Organizational Behavior: Managing People
and Organizations,Twelfth Edition
Ricky W. Griffin, Jean M. Phillips,
Stanley M. Gully
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ABOUT THE AUTHORS
Ricky W. Griffin
Ricky W. Griffin holds the Bloc ker Chair in Business and is University
­Distinguished Professor of Management in the Mays Business School at Texas
A&M University. He has also served as Head of the Department of Manage ment, Executive Associate Dean, and Interim Dean at Mays.
Ricky is both a member and F ellow of the Academy of Management
and has served as ­program chair and division c hair of the organization’ s
­Organizational Behavior ­division. He also served as editor of the Journal
of Management. Ricky’s research has appeared in Administrative Science
­Quarterly, Academy of ­Management Review, Academy of Management Journal,
Journal of Management, and several other journals. He has also edited several
scholarly books, most recently The Dark Side of Organizational Behavior.
He has authored or co-authored several leading textbooks , most of
which have been revised across multiple editions. His books have also been
­translated or adapted for use in over a dozen other countries . Ricky teaches
international management, organizational behavior, human resource management, and general management. He has taught both undergraduate and graduate students, participated in numerous executive training programs , and
has lectured in London, Paris, Warsaw, Geneva, Berlin, Johannesburg, Tokyo,
Hong Kong, and Sydney.
Jean M. Phillips
Jean Phillips is a Professor of Human Resource Management in the Sc hool of
Labor and Employment Relations at Penn State University. Jean earned her
Ph.D. from Michigan State University in Business Management and Organi zational Behavior. Her interests focus on leadership and team effectiveness ,
recruitment and staffing, and the processes that lead to employee and organizational success.
Jean was among the top 5 percent of published authors in the Journal of
Applied Psychology and Personnel Psychology during the 1990s and she
received t he 20 04 C ummings S cholar Award f rom th e O rganizational
­Behavior Division of the Academy of Management. She has published over
thirty research articles and nine books, including Strategic Staffing (3e, 2014),
Organizational Behavior (2e, 2013), Human Resource Management (2013),
Managing Now (2008), and the five-book Staffing Strategically (2012) series
for the Society for Human Resource Management. Jean was also the founding
co-editor of the Organizational Behavior/Human Resource Management series
for Business Expert Press.
Her applied work inc ludes leveraging employee surveys to enhance
strategic execution and business performance , developing leadership and
teamwork skills, and creating and evaluating strategic recruitment and
staffing programs. Jean has taught online and traditional courses in Human
Resource Management and Organizational behavior in the U.S., Iceland, and
Singapore.
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iii
iv
ABOUT THE AUTHORS
Stan M. Gully
Stan Gully is a Professor of Human Resource Management in the Sc hool of
Labor and Employment Relations at Penn State University. Stan holds M.A.
and Ph.D. degrees in Industrial/Organiz ational Psychology from M
­ ichigan
State University and he is a F ellow of the Society for Industrial and
­Organizational Psychology.
Stan has authored, co-authored, edited, or presented numerous papers,
books, and book chapters on a variety of topics, including leadership, team
­effectiveness, motivation, training, staffing, and recruitment. He is a found ing co-editor of the Organizational Behavior/Human Resource collection of
­Business Expert Press. Stan is ranked in the top fifty of the most influential
scholars who received their degrees since 1991 based on impact inside and outside of the Academy of Management and he has won awards for his teaching,
research, and service.
Stan has taught courses at the undergraduate , master’s, executive, and
Ph.D. levels covering a wide range of topics including team effectiveness, leadership, organizational learning and innovation, staffing, human resource management, training, and statistics. He has taught using traditional and hybrid
technologies in the United States , Iceland, Singapore, and Indonesia. His
applied work includes, but is not limited to , management at UPS, design of
leadership training programs, implementation of team communication interventions, and implementation of a multi-source feedback system.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
BRIEF CONTENTS
Preface
xxi
Acknowledgments
xxv
PART 1
INTRODUCTION TO ORGANIZATIONAL BEHAVIOR
1
CHAPTER 1
An Overview of Organizational Behavior
2
CHAPTER 2
The Changing Environment of Organizations
42
PART 2
INDIVIDUAL BEHAVIORS AND PROCESSES
IN ORGANIZATIONS
85
CHAPTER 3
Individual Characteristics
86
CHAPTER 4
Individual Values, Perceptions, and Reactions
122
CHAPTER 5
Motivating Behavior
168
CHAPTER 6
Motivating Behavior with Work and Rewards
206
PART 3
SOCIAL AND GROUP PROCESSES IN ORGANIZATIONS
251
CHAPTER 7
Groups and Teams
252
CHAPTER 8
Decision Making and Problem Solving
298
CHAPTER 9
Communication334
CHAPTER 10
Managing Conflict and Negotiating
PART 4
LEADERSHIP AND INFLUENCE PROCESSES IN ORGANIZATIONS 403
CHAPTER 11
Traditional Leadership Approaches
404
CHAPTER 12
Contemporary Views of Leadership in Organizations
434
CHAPTER 13
Power, Influence, and Politics
460
PART 5
ORGANIZATIONAL PROCESSES AND CHARACTERISTICS
491
CHAPTER 14
Organizational Structure and Design
492
CHAPTER 15
Organizational Culture
524
CHAPTER 16
Organization Change and Change Management
552
372
Name Index
590
Company Index
593
Subject Index
596
v
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CONTENTS
Preface
xxi
Acknowledgments
xxv
PART 1
INTRODUCTION TO ORGANIZATIONAL BEHAVIOR
CHAPTER 1
An Overview of Organizational Behavior
2
What is Organizational Behavior? 4
The Meaning of Organizational Behavior 4
How Organizational Behavior Impacts Personal Success 6
UNDERSTAND YOURSELF Global Mindset
7
How Organizational Behavior Impacts Organizational Success 8
CASE STUDY The J.M. Smucker Company
9
The Managerial Context of Organizational Behavior 10
Basic Management Functions and
Organizational Behavior 10
Critical Management Skills and
Organizational Behavior 12
Organizational Behavior and
Human Resource Management 14
IMPROVE YOUR SKILLS OB Related Job Interview Questions
The Strategic Context of Organizational Behavior
14
15
Sources of Competitive Advantage 15
Types of Business Strategies 16
Connecting Business Strategy to
Organizational Behavior 19
Contextual Perspectives on Organizational Behavior 20
Where Does Organizational Behavior Come From?
Organizations as Open Systems 22
Situational Perspectives on
Organizational Behavior 24
Interactionalism: People and Situations 25
20
Managing for Effectiveness 25
Enhancing Individual and Team
Performance Behaviors 25
Enhancing Employee Commitment
and Engagement 26
Promoting Organizational Citizenship Behaviors
Minimizing Dysfunctional Behaviors 27
Driving Strategic Execution 28
27
vii
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viii
Con ten ts
How Do We Know What We Know?
28
GLOBAL ISSUES Managing Across Cultures
33
The Framework of the Book 33
Summary and Application 35
Discussion Questions 36
Understand Yourself Exercise 37
Group Exercise 37
Video Exercise 38
Video Case 38
CHAPTER 2
The Changing Environment of Organizations
Diversity and Business 45
Types of Diversity and Barriers to Inclusion
42
45
Types of Diversity 45
Trends in Diversity 47
Generational Differences 48
Diversity Issues for Managers 50
CASE STUDY Diversity At Wegmans
54
Globalization and Business 54
Trends in Globalization 54
Cultural Competence 56
IMPROVE YOUR SKILLS Understanding Your Culture
Cross-Cultural Differences and Similarities
57
57
GLOBAL ISSUES Cultural Etiquette Quiz
58
Global Perspective 61
Technology and Business
61
Manufacturing and Service Technologies 61
UNDERSTAND YOURSELF Global Perspective
62
Technology and Competition 63
Information Technology 64
Ethics and Corporate Governance
64
Framing Ethical Issues 65
Ethical Issues in Corporate Governance 68
Ethical Issues and Information Technology 68
Social Responsibility 69
New Employment Relationships
71
The Management of Knowledge Workers 71
Outsourcing and Offshoring 72
Temp and Contingency Workers 73
Tiered Workforce 73
The Changing Nature of Psychological Contracts
74
Summary and Application 76
Discussion Questions 78
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Con ten ts
Understand Yourself Exercise 78
Group Exercise 79
Video Exercise 79
Video Case 80
PART 2
INDIVIDUAL BEHAVIORS AND PROCESSES IN
ORGANIZATIONS
CHAPTER 3
Individual Characteristics
86
People in Organizations 88
Individual Differences 88
The Concept of Fit 89
Realistic Job Previews 92
Personality and Individual Behavior 93
The “Big Five” Framework 93
The Myers-Briggs Framework 96
Other Important Personality Traits 97
Locus of Control 97
Self-Efficacy 98
Self-Esteem 98
Authoritarianism 98
UNDERSTAND YOURSELF Work Locus of Control
99
Machiavellianism 100
Tolerance for Risk and Ambiguity 100
Type A and B traits 101
The Bullying Personality 102
IMPROVE YOUR SKILLS Challenging Managerial Behaviors and
How to Respond 103
Role of the Situation 104
GLOBAL ISSUES How Others See Americans
Intelligence
104
105
General Mental Ability 105
Multiple Intelligences 106
Emotional Intelligence 107
CASE STUDY Emotional Intelligence at FedEx
109
Learning Styles 110
Sensory Modalities 110
Learning Style Inventory 110
Learning Style Orientations 111
Summary and Application 112
Discussion Questions 112
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ix
x
Con ten ts
Understand Yourself Exercise 114
Group Exercise 114
Video Exercise 115
Video Case 116
CHAPTER 4
Individual Values, Perceptions, and Reactions
122
Attitudes in Organizations 124
How Attitudes Are Formed 124
Cognitive Dissonance 126
Attitude Change 127
Key Work-Related Attitudes 128
Values and Emotions in Organizations
131
Types of Values 132
Conflicts among Values 133
How Values Differ around the World 133
The Role of Emotions in Behavior 134
Affect and Mood 136
Perception in Organizations
137
Basic Perceptual Processes 138
Errors in Perception 139
Perception and Attribution 140
UNDERSTAND YOURSELF Positive and Negative Affectivity
Perception and Fairness, Justice, and Trust
141
143
GLOBAL ISSUES How Culture Can Influence Attributions
143
CASE STUDY What to Do When the Boss Releases His Inner Toddler
146
Stress In Organizations 147
The Nature of Stress 148
Common Causes of Stress 150
Consequences of Stress 153
Managing and Controlling Stress 154
IMPROVE YOUR SKILLS Stress Management Tips
Work-Life Balance
155
157
Summary and Application 158
Discussion Questions 159
Understand Yourself 161
Group Exercise 161
Video Exercise 162
Video Case 163
CHAPTER 5
Motivating Behavior
The Nature of Motivation
168
170
The Importance of Motivation 170
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Con ten ts
The Motivational Framework 171
Early Perspectives on Motivation 172
Individual Differences and Motivation 173
GLOBAL ISSUES Motivating a Global Workforce
175
Need-Based Perspectives on Motivation 175
The Hierarchy of Needs 175
The ERG Theory 178
The Two-Factor Theory 178
The Acquired Needs Framework
181
UNDERSTAND YOURSELF What Motivates You?
183
Process-Based Perspectives on Motivation 184
The Equity Theory of Motivation 184
The Expectancy Theory of Motivation 187
IMPROVE YOUR SKILLS Framing Equity and Fairness
CASE STUDY Pride-Building at Aramark
188
192
Learning-Based Perspectives on Motivation 193
How Learning Occurs 193
Reinforcement Theory and Learning
Social Learning 195
Behavior Modification 196
194
Summary and Application 200
Discussion Questions 201
Understand Yourself 201
Group Exercise 202
Video Exercise 203
Video Case 203
CHAPTER 6
Motivating Behavior with Work and Rewards
206
Job Design in Organizations 209
Job Specialization 209
Basic Alternatives to Job Specialization
The Job Characteristics Theory 212
210
IMPROVE YOUR SKILLS Enriching Jobs for Employee
Motivation 214
Employee Participation and Involvement 214
Areas of Employee Participation 215
Approaches to Participation and Empowerment
216
GLOBAL ISSUES Participation Around the World
Flexible Work Arrangements
217
218
Variable Work Schedules 218
Extended Work Schedules 219
Flexible Work Schedules 220
Alternative Workplaces 221
Goal Setting and Motivation 221
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xi
xii
Con ten ts
Goal-Setting Theory 222
Broader Perspectives on Goal Setting
Goal Setting Challenges 225
Performance Management
224
225
Purposes of Performance Measurement 226
Elements of Performance Management 227
UNDERSTAND YOURSELF Your Feedback Style
228
The Balanced Scorecard Approach to Performance Management
Individual Rewards in Organizations
Roles, Purposes, and Meanings of Rewards
CASE STUDY The Whole Truth
230
232
232
233
Types of Rewards 234
Related Issues in Rewarding Performance
237
Summary and Application 241
Discussion Questions 244
Understand Yourself Exercise 244
Group Exercise 246
Video Exercise 247
Video Case 247
PART 3
SOCIAL AND GROUP PROCESSES IN ORGANIZATIONS
CHAPTER 7
Groups and Teams
Types of Groups and Teams
252
254
Workgroups 255
Teams 256
Informal Groups 258
Group Performance Factors 258
IMPROVE YOUR SKILLS Diagnosing Team Problems
259
Group Composition 259
Group Size 260
Group Norms 261
Group Cohesiveness 262
UNDERSTAND YOURSELF Are You Emotionally Intelligent?
264
Informal Leadership 265
Creating New Groups and Teams
265
Stages of Group and Team Development 266
Understanding Team Performance Factors 268
The Implementation Process 270
Managing Teams 274
Understanding Benefits and Costs of Teams
CASE STUDY Teamwork at IDEO
274
276
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Con ten ts
Promoting Effective Performance
Teamwork Competencies 280
277
Emerging Team Opportunities and Challenges 281
Virtual Teams 281
Diversity and Multicultural Teams 284
GLOBAL ISSUES Increasing the Effectiveness of
Multicultural Teams 285
Summary and Application 286
Discussion Questions 288
Understand Yourself Exercise 288
Group Exercise 291
Video Exercise 291
Video Case 292
CHAPTER 8
Decision Making and Problem Solving
298
The Nature of Decision Making 300
Types of Decisions 301
Decision-Making Conditions 303
The Rational Approach to Decision Making 305
Steps in Rational Decision Making 305
Evidence-Based Decision Making 309
The Behavioral Approach to Decision Making
310
The Administrative Model 310
UNDERSTAND YOURSELF Emotion-Based Decision Making
Other Behavioral Forces in Decision Making
311
312
GLOBAL ISSUES Culture and Nationality Influences on
Ethical Awareness 315
An Integrated Approach to Decision Making
315
Group Decision Making in Organizations 317
Group Polarization
Groupthink 318
317
CASE STUDY The Role of Groupthink in the Financial Crisis
Participation 322
Group Problem Solving
320
323
Creativity, Problem Solving, and Decision Making 324
IMPROVE YOUR SKILLS Creative Decisions Through Borrowing Ideas
325
The Creative Individual 325
The Creative Process 326
Enhancing Creativity in Organizations 328
Summary and Applications 328
Discussion Questions 329
Understand Yourself Exercise 330
Group Exercise 330
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xiii
xiv
Con ten ts
Video Exercise 330
Video Case 331
CHAPTER 9
Communication
334
The Communication Process
336
Nonverbal Communication 338
One-Way and Two-Way Communication 339
Task Interdependence 339
Barriers to Effective Communication 340
GLOBAL ISSUES Cultural Differences in Communication
344
Communication Skills 345
Listening Skills 346
Writing Skills 347
Presentation Skills 347
UNDERSTAND YOURSELF Listening Self-Assessment
Meeting Skills
348
350
IMPROVE YOUR SKILLS Improve Your Interview Skills
Communication Media
350
351
The Internet 351
Collaboration Software 353
Intranets 353
Oral Communication 356
Media Richness 357
CASE STUDY Communicating Ethics at Cisco
Organizational Communication
358
359
Downward Communication 359
Upward Communication 360
Horizontal Communication 361
Diagonal Communication 361
Formal and Informal Communication
Social Networking 362
362
Summary and Application 363
Discussion Questions 365
Develop Your Skills Exercise 366
Group Exercise 367
Video Exercise 367
Video Case 368
CHAPTER 10
Managing Conflict and Negotiating 372
The Nature of Conflict
374
Common Causes of Conflict 375
Conflict Escalation 379
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Con ten ts
De-Escalating Conflict 381
Role of Emotion in Conflict 383
Interpersonal Conflict Management Strategies 383
UNDERSTAND YOURSELF Your Preferred Conflict
Management Style 385
GLOBAL ISSUES Conflict Management Differences
Across Cultures 386
The Conflict Process 386
Conflict Management Skills 386
Creating Constructive Conflict 389
The Negotiation Process 389
Negotiating Skills 390
Cultural Issues in Negotiations 392
IMPROVE YOUR SKILLS Improving Your Negotiation Skills
Alternative Dispute Resolution
393
393
CASE STUDY Ombudsman to the Rescue
395
Summary and Application 395
Discussion Questions 396
Develop Your Skills Exercise 397
Group Exercise 397
Video Exercise 398
Video Case 399
PART 4
LEADERSHIP AND INFLUENCE PROCESSES IN
ORGANIZATIONS
CHAPTER 11
Traditional Leadership Approaches
404
The Nature of Leadership 406
The Meaning of Leadership 406
Leadership versus Management 407
Early Approaches to Leadership 408
IMPROVE YOUR SKILLS Are You Ready to Lead?
409
Trait Approaches to Leadership 410
Behavioral Approaches to Leadership 410
CASE STUDY Getting on Board with Diversity
411
The Emergence of Situational Leadership Models 415
The LPC Theory of Leadership 417
Task versus Relationship Motivation 417
UNDERSTAND YOURSELF Least-Preferred Coworker Scale
418
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xv
xvi
Con ten ts
Situational Favorableness 419
Evaluation and Implications 421
The Path-Goal Theory of Leadership
Basic Premises
421
421
GLOBAL ISSUES The Role of Leaders Across Cultures
422
Evaluation and Implications 423
Vroom’s Decision Tree Approach To Leadership
424
Basic Premises 424
Evaluation and Implications 427
Summary and Applications 427
Discussion Questions 429
Develop Your Skills Exercise 430
Group Exercise 431
Video Exercise 431
Video Case 432
CHAPTER 12
Contemporary Views of Leadership in Organizations
Contemporary Situational Theories
434
436
The Leader-Member Exchange Model 436
The Hersey and Blanchard Model 437
Refinements and Revisions of Other Theories
438
Leadership Through The Eyes of Followers
439
Transformational Leadership 439
Charismatic Leadership 440
CASE STUDY Leading a Police Force Transformation
441
UNDERSTAND YOURSELF How Charismatic Are You?
Attribution and Leadership
442
443
GLOBAL ISSUES Effect of Culture on Perceptions of Leaders’ Attributes
Alternatives to Leadership
444
445
Leadership Substitutes 445
Leadership Neutralizers 446
The Changing Nature of Leadership
447
Leaders as Coaches 447
Gender and Leadership 448
Cross-Cultural Leadership 448
International Leadership and Project GLOBE
Emerging Issues In Leadership
449
450
Strategic Leadership 450
Ethical Leadership 451
IMPROVE YOUR SKILLS Netiquette Tips for Managers
Virtual Leadership
452
452
Summary and Applications 453
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Con ten ts
Discussion Questions 455
Develop Your Skills Exercise 455
Group Exercise 456
Video Exercise 456
Video Case 457
CHAPTER 13
Power, Influence, and Politics
460
Power in Organizations 462
Position Power 462
Personal Power 465
Using Power
466
Acquiring and Using Power 467
Empowerment 469
How Subunits Obtain Power 470
Influence in Organizatons 471
Influence Tactics
471
CASE STUDY Influencing Decisions
473
Role of National Culture in Influence Effectiveness 474
Persuasion Skills 474
GLOBAL ISSUES Effectiveness of Different Influence Tactics Depends
on National Culture 474
Upward Influence 475
UNDERSTAND YOURSELF Upward Influence Scale
477
Organizational Politics 477
Causes of Political Behavior 479
Managing Organizational Politics 481
IMPROVE YOUR SKILLS Recognizing Politics
481
Impression Management 482
Summary and Application 484
Discussion Questions 485
Develop Your Skills Exercise 485
Group Exercise 486
Video Exercise 486
Video Case 487
PART 5
ORGANIZATIONAL PROCESSES AND CHARACTERISTICS
CHAPTER 14
Organizational Structure and Design
492
Organizational Structure 494
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xvii
xviii
Con ten ts
Characteristics of Organizational Structure
Mechanistic and Organic Structures 499
496
IMPROVE YOUR SKILLS Delegation Skills
500
UNDERSTAND YOURSELF What is Your Preferred Type of Organizational
Structure?
502
Determinants of Organizational Structure
502
Business Strategy 502
External Environment 503
Organizational Talent 504
Organizational Size 504
Behavioral Expectations 504
Production Technology 505
Organizational Change 505
Types of Organizational Structures
506
Functional Structure 507
Divisional Structure 507
GLOBAL ISSUES Multinational Organizational Structures
508
Matrix Structure 508
Team-Based Structure 510
Lattice Structure 510
Network Organization 510
CASE STUDY The Morning Star’s Lattice Structure
511
Contemporary Issues in Organizational Structure
512
Virtual Organizations 512
Integrating Employees 512
Communities of Practice 513
Effects of Restructuring on Performance
515
Summary and Application 515
Discussion Questions 517
Develop Your Skills Exercise 517
Group Exercise 519
Video Exercise 520
Video Case 520
CHAPTER 15
Organizational Culture
524
The Meaning and Determinants of Organizational Culture
Does Culture Matter? 528
How Leaders Create and Maintain Culture
526
530
Cultures of Conflict and Cultures of Inclusion
532
Cultures of Conflict 532
GLOBAL ISSUES Cross-Cultural Influences on Conflict Cultures
Cultures of Inclusion
534
534
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
Con ten ts
CASE STUDY Building a Culture for Inclusion at Whirlpool
IMPROVE YOUR SKILLS Assessing Culture
535
536
Effects of Technology and Innovation on Culture
536
Using Intranets to Build and Maintain Culture 536
Building and Maintaining Culture with Remote Employees
Innovation and Culture 538
537
Managing Organization Culture 540
Taking Advantage of the Existing Culture 540
Teaching the Organization Culture: Socialization 541
Changing the Organization Culture 542
UNDERSTAND YOURSELF Refining Your Sense of Culture
543
Summary and Application 545
Discussion Questions 546
Develop Your Skills Exercise 546
Group Exercise 547
Video Exercise 548
Video Case 549
CHAPTER 16
Organization Change and Change Management
552
Forces for Change 554
People 554
UNDERSTAND YOURSELF What is Your Tolerance for Ambiguity?
556
Technology 557
Information Processing and Communication 558
Competition 559
GLOBAL ISSUES The Added Complexity of Global Change
560
Processes for Planned Organization Change 560
Lewin’s Process Model 560
The Continuous Change Process Model
CASE STUDY Flexibility at KPMG
562
564
Organization Development 564
Organization Development Defined 565
System-Wide Organization Development 565
Task and Technological Change 568
Group and Individual Change 570
Resistance to Change 573
IMPROVE YOUR SKILLS Innovative Attitude Scale
575
Organizational Sources of Resistance 576
Individual Sources of Resistance 577
Managing Successful Organization Change and Development
578
Consider Global Issues 578
Take a Holistic View 579
Start Small 579
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xix
xx
Con ten ts
Secure Top Management Support 579
Encourage Participation 580
Foster Open Communication 580
Reward Contributors 580
Organizational Learning 580
Summary and Application 582
Discussion Questions 584
Develop Your Skills 584
Group Exercise 585
Video Exercise 586
Video Case 587
Name Index 590
Company Index 593
Subject Index 596
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
PREFACE
Welcome to the 12th edition of Organizational Behavior. Or is it the 3rd edition? Or even the 1st edition? In some w ays any of these edition numbers
might be correct. How is this possible? Let’s explain. …
Ricky Griffin and Greg Moorhead published a textbook entitled
­Organizational Behavior in 1986. The book was very successful and underwent
regular ­revisions every few years. The hallmark of Organizational ­Behavior
has long been comprehensive content based on sound academic ­r esearch
brought to life through examples and case studies. Since its very first edition
the book has been a market leader. A few years ago Greg retired from teac hing after a long and distinguished career but continued to work with Ric ky on
multiple editions of Organizational Behavior. However, he finally decided to
give up this work as well, and the 11th edition was his last.
Meanwhile, Jean Phillips and Stan Gully published the first edition of
their own Organizational Behavior textbook in 2012 and revised it in 2014.
Jean and Stan’s book also had strong content, of course, but it truly set new
standards of excellence with its outstanding array of features, learning aids,
digital support material, and video programs. In 2014, Ricky, Jean, and Stan
met in Philadelphia during the Academy of Management meeting and came
up with the idea of combining our books. We saw this as a true win-win opportunity to create a new book that would merge the historically strong content of
the older book with the contemporary content and cutting-edge support mate rials of the newer book.
Development Process
We started our work by carefully reviewing each of the two existing books, new
and current developments in the field of organizational behavior, and ­reviewer
feedback about the strengths of each book. We then carefully developed a new
outline of sixteen chapters. In our judgment, this structure provides thorough
and comprehensive coverage of the major topics within the field of organiza tional behavior while also providing a framework that can be effectively cov ered in a single semester.
We also developed an integrated learning model that demonstrates how
all of the topics within the book relate to one another. This model is developed
in Chapter 1. It is then revisited at the begi nning of each part. The reader
is reminded of how earlier c hapters led them to the current discussion and
where the discussion is headed next. Last but not least, we included most of
the features that Jean and Stan had so carefully created.
Our goals are to make you more successful in your life and career by helping you understand yourself, understand organizations, and understand the
role of organizational behavior (OB) in your personal career success. We also
want to cultivate an understanding of and ability to apply knowledge about
individual and group beha vior in organizations and to appreciate how the
entire organizational system operates. This will enhance your understanding of how to flexibly apply the OB concepts that are appropriate for different
problems or situations. Finally, we want to ensure that you ha ve a complete
xxi
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
xxii
PREFACE
understanding of the modern OB context, including ethics, diversity, competitive advantage, technology, and the global context.
Features
Our new book contains several features designed to reinforce the themes of
the book and further develop your OB skills.
Real World Challenge To help you recognize OB-relevant issues in organizations, each chapter begins with a Real World Challenge that describes a real
challenge or problem faced by a person or organization that relates to that
chapter’s content. The chapter then concludes with a description of how the
company or individual addressed the challenge.
Global Issues A Global Issues feature in each chapter highlights the global
implications of some of the chapter’s content.
Case Study A Case Study in each chapter reinforces some of each chapter’s
material and gives you the opportunity to apply what you learn in the chapter
to a real organizational situation.
Understand Yourself To help you better understand your own characteristics,
an Understand Yourself feature in each chapter gives you the c hance to assess
yourself on a variety of topics relevant to OB . This feature will help you better
understand what motivates you, how you view money, your leadership style, your
emotional intelligence, and your diversity awareness, among other things.
Improve Your Skills Each chapter also contains an Improve Your Skills box
to help you become more effective in different areas inc luding dealing with
challenging managerial behaviors, interviewing, managing stress, negotiating,
and assessing an organization’s culture and political environment.
Group Exercises Each chapter also includes a group-based experiential
e­ xercise. This exercise will help both further your understanding of basic
­concepts of organizational behavior while simultaneously helping you improve
your skills in working with others.
Now What? Video Cases Captivating Now What? decision-making videos
put you in the manager’s chair. Four videos are included for each chapter, with
the first video presenting a business challenge, and three shorter videos providing
“correct” and “incorrect” responses to the challenge. A short synopsis and discussion questions to accompany each video are included at the end of the chapter.
Video Exercises Also included with each chapter are separate stand-alone
videos featuring real-world companies to show managerial challenges. These
exercises and discussion questions appear at the end of each chapter.
Instructor Support Materials
•
Instructor Companion Website: Instructors can find course su pport
­m aterials, inc luding Instructor’s Resource Manual, Test Bank files ,
­PowerPoint® slides, and DVD guide.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
PREFACE
•
•
xxiii
On the Job DVD: “On the Job” videos provide behind-the-scene insights
into management concepts at work within actual small and large businesses. Corresponding support material can be found in the DVD guide.
Cengage Learning Testing, powered by Cognero ® Instant Access: Cengage
Learning Testing powered by Cognero® is a flexible, online system that allows you to: import, edit, and manipulate content from the text’s test bank
or elsewhere, including your own favorite test questions; create multiple
test versions in an instant; and deliver tests from your LMS , your classroom, or wherever you want.
Student Support Materials
MindTap® Management is t he digital learning solution that helps instructors engage students and help them relate management concepts to
their lives. Through interactive assignments students connect manage ment concepts to real-world organizations and say how managers should
­perform in given situations. Finally, all activities are designed to teac h
students to problem-solve and think like management leaders. Through
these a
­ ctivities and real-time course analytics, and an accessible reader,
MindTap helps you turn cookie cutter into cutting edge , apathy into
­engagement, and memorizers into higher-level thinkers.
Our adaptive learning solution provides customized questions, text, and
video resources based on student proficiency. Priced to please students and
administrators, this solution will help you develop the next generation of
managers.
• The learning path is based on our Engage, Connect, Perform, and
Lead model. Students are drawn into the material with self-assessments.
Quizzes and homework assignments help students connect concepts with
the real world, and higher level homework assignments ask students to
analyze and manage complex situations.
• Self-Assessments engage students by helping them make personal
connections to the content presented in the chapter.
• Reading Quizzes assess students’ basic comprehension of the reading
material to help you gauge their level of engagement and understanding of the content. Students are able to see compare their responses
against others in their class, school and everyone one who’s previously
taken the self-assessment.
• Assignments for each chapter elevate thinking challenging students
to think critically and begin to think like managers.
• Concept Videos present short enric hment clips of information on
topics students typically struggle with.
• Video Case Activities engage students by presenting everyday businesses facing managerial c hallenges, placing concepts in real-world
context and making for great points of discussion.
• Experiential Exercises powered by YouSeeU include role play
and group projects challenge students to work in teams in our one-ofa-kind collaborative environment to solve real-world managerial problems, develop skills and begin to experience firsthand what it’ s like to
work in management.
• Branching Activities challenge students to evaluate work situations
and decide what actions they might take as managers. Then students
•
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xxiv
PREFACE
•
•
use their knowledge of management to identify the advantages and
disadvantages of different managerial approaches.
Adaptive Study Centers powered by Knewton are provided at the
unit level and the exam level to help students work tow ard mastery of
course content. Material presented is customized to students’ specific
needs and serves up questions , feedback, remediation, and instructional content according to how they progress.
Writing Activities powered by Write Experience offers students
the opportunity to improve their writing and analytical skills without
adding to your workload. Offered through an exclusive agreement with
Vantage Learning, creator of the software used for GMAT essay grading, Write Experience evaluates students’ answers to a select set of
­assignments for writing for voice, style, format, and originality.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
ACKNOWLEDGMENTS
Although this book bears our three names, many other people have also contributed to it. Through the years we have had the good fortune to work with
many fine professionals who helped us to sharpen our thinking about this com
plex field and to develop new and more effective ways of discussing it. Over the
course of multiple editions of two different books literally dozens of reviewers
have helped us develop and refine our materials. Their contributions were also
essential to the development of this edition. Any and all errors of omission,
interpretation, and emphasis remain the responsibility of the authors.
The 12th edition could never ha ve been completed without the support
of Texas A&M University, Rutgers University, and Penn State University.
We would also like to ac knowledge the outstanding team of professionals at
Cengage Learning who helped us prepare this book. Julia Chase has been
steadfast in her commitment to quality and her c harge to us to raise quality
throughout the book. Scott Person, Carol Moore, Mike Schenk, Jason Fremder,
Brian Pierce, and Erin Joyner were also instrumental to our work. Jennifer
Ziegler, Rajachitra Suresh, Sarah Shainwald, and Diane Garrity were also key
players in the creation of this text and support program. We would also like
to acknowledge the decades-long contributions that Greg Moorhead made to
this book. His friendship and professionalism will always be remembered. We
would like to thank the iTV studio team as well as the entire cast and crew
for helping us to create engaging and interesting videos that bring the book
concepts to life. We wish to highlight the efforts of J. Allen Sudeth, Pete Troost,
John Keller, and Hebert Peck for making the videos possible.
Finally, we would like to ac knowledge importance of our families . For
Ricky, he was reminded many times during the work on this book about the
central role of family and the fragility of life . He sends special appreciation
to Glenda, Dustin, Ashley, Matt, and Lura. For Jean and Stan, Ryan, Tyler,
­Murphy (the dog), and Mooch (the cat), provided love and laughs to motivate
them and to help them to keep things in perspective.
xxv
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
DEDICATION
For the next generation—Griffin, Sutton, and Andrew (RWG)
To Ryan and Tyler, who make our lives complete (JMP & SMG)
xxvii
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
PART
LOSKUTNIKOV/SHUTTERSTOCK.COM
1
INTRODUCTION TO
ORGANIZATIONAL BEHAVIOR
1 CHAPTER 1 An Overview of Organizational Behavior
2 CHAPTER 2 The Changing Environment of Organizations
Managers strive to make their organizations as effective and successful as possible. To do this they rely on assets
such as financial reserves and earnings, technology and equipment, raw materials, information, and operating
systems and processes. At the center of everything are the employees who work for the organization. It is usually
their talent, effort, skill, and ability that differentiates effective from less effective organizations. It is critical, then,
that managers understand how the behaviors of their employees impact organizational effectiveness.
In general, managers work to enhance employee performance behaviors, commitment and engagement, and
citizenship behaviors and to minimize various dysfunctional behaviors. A number of environmental, individual,
group and team, leadership, and organizational characteristics can make the manager’s work easier or more
difficult depending on how well they understand organizational behavior. This model will be more fully developed in
Chapter 1 and will serve as a roadmap for your study of organizational behavior throughout this book.
How does the
environment matter?
M
SH ON
U G
TT M
ER UL
ST TI
O PL
CK Y/
.C
O
M
Why do individuals
do what they do?
• Individual
characteristics
• Individual values,
perceptions, and
reactions
• Motivating behavior
• Motivating behavior
with work and
rewards
Why does leadership
matter?
• Traditional leadership
approaches
• Modern leadership
approaches
• Power, influence, and
politics
What makes managers
and organizations effective?
• Enhancing performance
behaviors
• Enhancing commitment and
engagement
• Promoting citizenship
behaviors
• Minimizing dysfunctional
behaviors
How does the
environment matter?
Why do groups and
teams do what they
do?
• Groups and teams
• Decision making and
problem solving
• Communication
• Conflict and
negotiation
How do
organizational
characteristics
influence
effectiveness?
• Organization structure
and design
• Organization culture
• Change management
PHANT/SHUTTERSTOCK.COM
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
LOSKUTNIKOV/SHUTTERSTOCK.COM
CHAPTER
1
CHAPTER
OUTLINE
AN OVERVIEW OF
ORGANIZATIONAL BEHAVIOR
Real World Challenge: Managing
Growth at Google
Connecting Business Strategy to
Organizational Behavior
AN OVERVIEW OF ORGANIZATIONAL
BEHAVIOR
CONTEXTUAL PERSPECTIVES ON
ORGANIZATIONAL BEHAVIOR
Where Does Organizational Behavior
Come From?
Organizations as Open Systems
Situational Perspectives on
Organizational Behavior
Interactionalism: People and
Situations
WHAT IS ORGANIZATIONAL
BEHAVIOR?
The Meaning of Organizational
Behavior
How Organizational Behavior
Impacts Personal Success
Understand Yourself: Global Mindset
Case Study: The J.M. Smucker Company
THE MANAGERIAL CONTEXT OF
ORGANIZATIONAL BEHAVIOR
Basic Management Functions and
Organizational Behavior
Critical Management Skills and
Organizational Behavior
Organizational Behavior and Human
Resource Management
Improve Your Skills: OB Related Job
Interview Questions
MANAGING FOR EFFECTIVENESS
Enhancing Individual and Team
Performance Behaviors
Enhancing Employee Commitment
and Engagement
Promoting Organizational Citizenship
Behaviors
Minimizing Dysfunctional Behaviors
Driving Strategic Execution
How Do We Know What We Know?
Global Issues: Managing Across Cultures
THE STRATEGIC CONTEXT OF
ORGANIZATIONAL BEHAVIOR
Sources of Competitive Advantage
Types of Business Strategies
SUMMARY AND APPLICATION
Real World Response: Managing
Growth at Google
After studying this chapter, you should be
able to:
LEARNING
OUTCOMES
THE FRAMEWORK OF THE BOOK
the relationships between strategy
and organizational behavior.
1 Define organizational behavior and
4 Identify and describe contextual
2 Identify the basic management
5 Describe the role of organizational
3 Describe the strategic context of
6 Summarize the framework around
describe how it impacts both personal
and organizational success.
functions and essential skills that
comprise the management process and
relate them to organizational behavior.
organizational behavior and discuss
perspectives on organizational
behavior.
behavior in managing for
effectiveness and discuss the role of
research in organizational behavior.
which this book is organized.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
MANAGING GROWTH AT GOOGLE
Google’s popular search engine was created in 1998 when founders Larry Page and Sergey
Brin cofounded the firm with the goal of making the world’s information available to every-
LOSKUTNIKOV/SHUTTERSTOCK.COM
REAL WORLD CHALLENGE
one.1 Being a startup, Google’s founders were understandably concerned about inspiring
and retaining the innovative talent that would make or break the company’s future success.
Page and Brin realized that Google’s explosive growth needed to be closely monitored,
and that its employees needed to continue feeling like an important part of the team.2 The
founders wanted to make Google an engaging place to work and set out to design the
organization and its culture in a way that would appeal to its current and future employees. Imagine that Google’s founders asked you for advice during the early days of Google.
What advice would you give them about the role of its people in its future success and how
to set up the company to maximize employee innovation, trust, and loyalty?
AP IMAGES/DYCJ
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
4
PART 1 | Introduction to Organizational Behavior
LUCKY
BUSINE
SS/SHUT
TERSTO
CK.COM
The success of any organization is often determined by how effectively
managers can enhance the performance behaviors of their employees,
enhance their commitment to and engagement with the organization,
promote citizenship behaviors, and minimize dysfunctional behaviors.
PRESS
MASTE
R/SHU
TTERS
TOCK.C
OM
Regardless of their size, scope, or location, all organizations
have at least one thing in common—they are comprised of
people. It is these people who make decisions about the stra tegic direction of a firm, it is they who acquire the resources
the firm uses to create new products , and it is they who sell
those products. People manage a firm’s corporate headquarters, its warehouses, and its information technology, and it is
people who clean up at the end of the day. No matter how effective a manager might be, all organizational successes—and failures—are the result of the behaviors of many people. Indeed, no
manager can succeed without the assistance of others.
Thus, any manager—whether responsible for a big business
such as Google, Abercrombie & Fitch, General Electric, Apple,
Starbucks, or British Airways; for a nic he business such as the
Boston Celtics basketball team or a Ma yo Clinic facility; or for a
local Pizza Hut restaurant or neighborhood dry cleaning establishment—must strive to understand the people who work in the organization. This book is about those people . It is also about the
organization itself and the managers who operate it. Together, the
study of organizations and the study of the people who work in them
constitute the field of organizational behavior. Our starting point in exploring
this field begins with a more detailed discussion of its meaning and its impor tance to employees, business owners, and managers.
WHAT IS ORGANIZATIONAL BEHAVIOR?
What exactly is meant by the term “organizational behavior”? And why should
it be studied? Answers to these two fundamental questions will both help
establish our foundation for discussion and analysis and help you better
appreciate the rationale as to how and why understanding the field can be of
value to you in the future.
The Meaning of Organizational Behavior
organizational behavior
The study of
human behavior in
organizational settings,
the interface between
human behavior and the
organization, and the
organization itself.
Organizational behavior (OB) is the study of human behavior in organizational settings, of the interface between human behavior and the organization,
and of the organization itself.3 Although we can focus on any one of these three
areas, we must also remember that all three are ultimately necessary for a
comprehensive understanding of organizational behavior. For example, we can
study individual behavior without explicitly considering the organization. But
because the organization influences and is influenced by the individual, we
cannot fully understand the individual’s behavior without learning something
about the organization. Similarly, we can study organizations without focusing
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 1 | An Overview of Organizational Behavior
O
OKIBAH
.COM/L
PHOTO
K
C
O
T
IS
Managers at businesses like The Home Depot need to understand
individual employee behavior, characteristics of the organization
itself, and the interface between individual behavior and the
organization.
explicitly on the people within them. But again, we
are looking at only a portion of the puzzle. Eventually
we m ust c onsider t he o ther p ieces, a s w ell a s t he
whole. Essentially, then, OB helps explain and predict
how people and groups interpret events , react, and
behave in organizations and describes the role of organizational systems, structures, and process in shaping
behavior.
Figure 1.1 illustrates this view of organizational
behavior. It shows the linkages among human behavior in
organizational settings, the individual–organization interface, the organization itself, and the environment surrounding the organization. Each individual brings to an
organization a unique set of personal c haracteristics and a unique personal
background and set of experiences from other organizations. Therefore, in considering the people who work in their organizations, managers must look at the
unique perspective each individual brings to the work setting . For example,
suppose managers at The Home Depot review data showing that employee
turnover within the firm is gradually but consistently increasing. Further suppose that they hire a consultant to help them better understand the problem.
As a starting point, the consultant might analyze the types of people the com pany usually hires. The goal would be to learn as muc h as possible about the
nature of the company’s workforce as individuals—their expectations, their
personal goals, and so forth.
Figure 1.1
The Nature of Organizational Behavior
Environment
Human Behavior in
Organizational Settings
The Individual–Organization Interface
The Organization
The field of
organizational behavior
attempts to understand
human behavior in
organizational settings,
the organization itself,
and the individual–
organization interface.
As illustrated here,
these areas are highly
interrelated. Thus,
although it is possible
to focus on only one of
these areas at a time, a
complete understanding
of organizational
behavior requires
knowledge of all three
areas.
Environment
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
5
6
PART 1 | Introduction to Organizational Behavior
But individuals do not work in isolation. They come in contact with other
people and with the organization in a variety of ways. Points of contact include
managers, coworkers, the formal policies and procedures of the organization,
and various changes implemented by the organization. In addition, over time,
individuals change, as a function of personal experiences and maturity as well
as through work experiences and organizational developments. The organization, in turn, is affected by the presence and eventual absence of the individual. Clearly, then, managers must also consider how the individual and the
organization interact. Thus, the consultant studying turnover at The Home
Depot might next look at the orientation procedures and initial training for
newcomers to the organization. The goal of this phase of the study would be to
understand some of the dynamics of how incoming individuals are introduced
to and interact with the broader organizational context.
An organization, of course, exists before a particular person joins it and continues to exist after he or she leaves. Thus, the organization itself represents a
crucial third perspective from whic h to view organizational beha vior. For
instance, the consultant studying turnover would also need to study the struc ture and culture of The Home Depot. An understanding of factors suc h as a
firm’s performance evaluation and rew ard systems, its decision-making and
communication patterns, and the structure of the firm itself can provide added
insight into why some people choose to leave a company and others elect to stay.
Clearly, then, the field of organizational beha vior is both exciting and com plex. Myriad variables and concepts accompany the interactions just described,
and together these factors greatly complicate the manager’s ability to understand,
appreciate, and manage others in the organization. They also provide unique and
important opportunities to enhance personal and organizational effectiveness.
How Organizational Behavior Impacts
Personal Success
You may be wondering about the relevance of OB to your current major or
career path. You might be thinking, “I don’t know any organizational behaviorists. Why is this topic important?” We field this question all the time from
people unfamiliar with OB. The core of OB is being effective at work. Understanding how people behave in organizations and why they do what they do is
critical to working effectively with and managing others . OB gives everyone
the knowledge and tools they need to be effective at any organizational level.
OB is an important topic for anyone who works or who will eventually work in
an organization, which is the case for most people . Moreover, OB is actually
important to us as individuals from numerous perspectives.
In our relationships with organizations, we may adopt any one of several
roles or identities. For example, we can be consumers, employees, suppliers,
competitors, owners, or investors. Since most readers of this book are either
present or future managers, we will adopt a managerial perspective through out our discussion. The study of organizational behavior can greatly clarify the
factors that affect how managers manage. Hence, the field attempts to describe
the complex human context of organizations and to define the opportunities ,
problems, challenges, and issues associated with that realm.
Whenever managers are surveyed ten to fifteen years out of school and asked
to identify the most important classes they ever took, OB is usually one of them.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 1 | An Overview of Organizational Behavior
7
U N D E R S TA N D Y O U R S E L F
GLOBAL MINDSET
A global mindset reflects your ability to influence people,
groups, and organizations from a variety of backgrounds
and cultures. Multinational companies’ ability to create
globally integrated systems depends on their ability to get
employees, managers, and executives to understand and
adapt to the realities of a globalized economy. The ability to integrate talent from many parts of the world faster
and more effectively than other companies is a source of
a firm’s competitive advantage5 as well as your own personal competitive advantage.
Please use the following scale in responding to the ten
questions below. When you are finished, follow the scoring instructions at the bottom to calculate your score. Then
read more about what your score means, and how you
can improve your global mindset.
strongly
disagree
disagree
1
2
neutral
agree
strongly
agree
3
4
5
___ 1. In interacting with others, I assign equal status to
people regardless of their national origin.
___ 2. I consider myself as equally open to ideas from
other countries and cultures as I am to ideas from
my own country and culture of origin.
___ 3. Finding myself in a new cultural setting is exciting.
___ 4. I see the world as one big marketplace.
___ 5. When I interact with people from other cultures,
it is important to me to understand them as
individuals.
___ 6. I regard my values to be a hybrid of values acquired from multiple cultures as opposed to just
one culture.
___ 7. I get very curious when I meet someone from another country.
___ 8. I enjoy trying food from other countries.
___ 9. In this interlinked world of ours, national boundaries are meaningless.
___ 10. I believe I can live a fulfilling life in another
culture.
Scoring: Add up your responses to identify your global
mindset score.
TUULIJUMALA/SHUTTERSTOCK.COM
This is not because it made them technically better in their area of specialty, but
because it made them more effective employees and better managers. As one
expert has put it, “It is puzzling that we seek expert advice on our golf game but
avoid professional advice on how we can deal with other people.”4 Using your
knowledge of OB can help you to succeed faster in any organization or career.
Interpretation: Because experiences influence global
mindset in a positive or negative manner,6 you can take
steps to improve your global mindset. Based on your score,
you might consider some of the personal development activities identified below, or you might come up with others.
If your score is between 10 and 20, you have a relatively low global mindset. Formal training/educational
programs, self-study courses, university courses, or in-­
company seminars or management development programs
can help you to increase your global mindset.
If your score is between 21 and 35, you have a moderate global mindset. You do not exhibit extremely high
parochialism, but at the same time you are not as open to
people from other cultures as you could be. In addition to
the self-development activities listed above, you might consider joining some culturally diverse student organizations
and making a point of befriending some people from other
cultures to gain more experience and become more comfortable with people from other cultures.
If your score is between 36 and 50, you have a high
global mindset. This means that you are open to meeting
people from a variety of cultures, and are comfortable with
global diversity. This does not mean you cannot improve
further! Joining international student organizations, working with international volunteer organizations, and
befriending people from a variety of cultures will further
develop your global mindset.
Source: Adapted from Gupta, A.K., & Govindarajan, V. (2002).
Cultivating a global mindset. Academy of Management Executive, 16(1),
116–126; Kefalas, A. G., & Neuland, E. W. (1997). Global mindsets:
an exploratory study. Paper presented at the Annual Conference of the
Academy of International Business, Moneterrey, Mexico, 4–7 October;
Nummela, N., Saarenketo, S., & Puumalainen, K. (2004). Global
mindset—a prerequisite for successful internationalisation? Canadian
Journal of Administrative Sciences, 21(1), 51–64.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
PART 1 | Introduction to Organizational Behavior
AGES
HSBC, an global financial services business, routinely sends its most
promising young managers on international assignments. The purpose
of this approach is to build a cohort of future top managers and leaders
who have extensive international experience.
E FAVR
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We w ill d iscuss d iversity a nd t he i mportance o f
flexibly applying OB concepts to different people
throughout the book. This chapter’s Understand Yourself feature gives you the opportunity to better under stand your global mindset, or set of individual attributes
that e nable y ou t o influence i ndividuals, g roups, and
organizations from diverse socio/cultural/institutional
systems. 7 Global mindset combines cultural intelligence
and a global business orientation. 8 Most chief executives
of large multinational organizations believe that having a
strong cadre of globally minded leaders would strengthen
their organization’s competitiveness.9
Because global mindset is learned, experiences can influence it in a positive or negative manner.10 Every year, the financial services
giant HSBC sends promising new hires and managers into long-term business
experiences abroad to build a cohort of international officers. Locations include
western countries as well as Saudi Arabia, Indonesia, and Mexico. To make a
career at HSBC, managers must perform these international missions . This
enables HSBC to develop a continuous supply of globally minded managers
capable of cross-border learning . Similar approaches are pursued by other
multinationals to enable them to transfer expertise and know-how across geographical, cultural, and political divides.11
JEROM
8
How Organizational Behavior Impacts
Organizational Success
Organizations as a whole also benefit from OB. Imagine the difference between
a company with motivated, engaged employees with clear goals aligned with
the business strategy and one with unhappy employees, a lot of conflict, weak
leadership, and a lack of direction. Effectively implementing OB concepts and
models is what creates effective and successful companies. OB is clearly important to organizations. By appropriately applying OB knowledge about individuals, groups, and the effect of organizational structure on worker beha vior, the
conditions can be created that make organizations most effective.
OB also helps companies perform well. A mounting body of evidence shows
that an emphasis on the softer side of business positively influences bottom line
results. By listening to employees, recognizing their work, building trust, and
behaving ethically, managers have boosted such performance measures as operating earnings, return on investment, and stock price.12 In addition to financial
performance and job satisfaction, OB also influences absenteeism and turnover.
Reducing absenteeism and turnover can be worth millions of dollars to organizations through increased productivity and customer service and decreased staff ing costs. This chapter’s Case Study highlights The J.M. Smucker Company’s
attention to OB principles including ethics, organizational culture, and values.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 1 | An Overview of Organizational Behavior
CASE STUDY
9
The J.M. Smucker Company
From its founding in 1897, when Jerome Monroe
Smucker sold apple butter from the back of a
horse-drawn wagon, the J.M. Smucker Company
has recognized that acting ethically is a key element of its success. The Orrville, Ohio, manufacturer wants to ensure that its signature comfort
foods—fruit spreads, frostings, juices, and
­beverages—remain American staples, and that its
daily operations are guided by honesty, respect,
trust, responsibility, and fairness.
Ensuring that the company meets the highest
ethical standards starts with hiring people who
already have a strong personal value system. To do
this, Smucker steeps job candidates in its ethical
standards and refers frequently to how company
values relate to the particular position a job candidate is seeking. The company also engages in rigorous reference checks. Once hired, the ethics
emphasis intensifies. Each new hire attends a daylong training seminar that includes presentations by
company officials, videos, and breakout sessions
on moral awareness, moral courage, and values.
The discussions go much deeper than a superficial review of how to be a good person. One
session concentrates on three ways to make a
decision when faced with a dilemma. One option
is seeking to do the greatest good for the greatest
number of people. The second is a rules-based
approach in which the decision will set a standard that everyone else follows. The final alternative is to use the Golden Rule: “treat others as you
would like to be treated.”
The sessions also explore the complexity of
ethics. Employees are rarely in a clear-cut situation where right and wrong are obvious. Ethical
decisions often involve a nuanced balance
between right and right. For example, the choice
an employee has to make may involve questions
related to the pulls between truth and loyalty, the
individual versus the community, and short-term
versus long-term approaches to business decisions. Smucker communicates that it wants its
employees to act with truth over loyalty, community over the individual, and long-term over shortterm company interests. All employees go through
the ethics program again every three to five years,
and sign a detailed nine-page ethics statement
annually to ensure that they truly understand the
level of performance Smucker expects from them.
Smucker also strongly believes in environmental sustainability, including utilizing renewable
energy, improving wastewater management,
using sustainable raw materials, and reusing
resources rather than consuming new ones.
Smucker promotes social sustainability in the communities in which it operates, promoting initiatives
and programs that support and enhance the quality of life. The J.M. Smucker Company has consistently appeared on Fortune Magazine’s “100 Best
Places to Work For” list, which it attributes in part
to its strong culture.
Questions:
1. Why would ethics be important to a company like J.M. Smucker? How can its focus
on values and ethics improve its business
performance?
2. Appearing on “best places to work” lists
can increase an employer’s popularity,
even among lower-qualified applicants. The
increased volume of applicants can be costly
and time-consuming. What do you feel are the
benefits and drawbacks to being on this type
of list? Do you think that it is generally beneficial to be publicly recognized as a good
employer? Why or why not?
3. Do J.M. Smucker’s values and culture appeal to
you as a potential employee? Why or why not?
Source: J.M. Smucker. (2014). J.M. Smucker 2014 Annual Report. Retrieved from http://static1.squarespace.com/static/
53650b18e4b08e20f53d167b/t/539ee6cee4b06b36446ac3f1/1402922702613/Smucker%27s+2014+Annual+
Report_embed.pdf; Smucker Gift Will Establish Business Leadership Institute (2012). The University of Akron, April 23.
Available online: http://www.uakron.edu/im/online-newsroom/news_details.dot?newsId=d24e5be1-b6fc-431b-871c164ada224a69&crumbTitle=Smucker%20gift%20will%20establish%20business%20leadership%20institute; Harrington, A.
(2005). Institute for Global Ethics Expands Focus on Business Practices with Center for Corporate Ethics, CSRWire, January 27.
Available online at: http://www.csrwire.com/News/3473.html; Schoeff, M. (2006). Workforce Management, March 13, p. 19;
“Award-Winning Company,” smuckers.com. Available online at: http://www.smuckers.com/family_company/join_our_company/
award_winning_company.aspx; “Sustainability,” smuckers.com. Available online at: http://www.smuckers.com/family_company/
join_our_company/sustainability.aspx.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
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LOSKUTNIKOV/SHUTTERSTOCK.COM
10
PART 1 | Introduction to Organizational Behavior
One central value of organizational behavior is that it isolates important
aspects of the manager’s job and offers specific perspectives on the human side
of management: people as organizations, people as resources, and people as
people. To further underscore the importance of organizational beha vior to
managers, we should consider this simple fact:Year in and year out, most of the
firms on Fortune’s list of the world’s most admired companies have impeccable
reputations for valuing and respecting the people who work for them. 13 Similarly, as the use of technology steadily increases, virtual teams become more
common. The success of virtual teams , in turn, often depends on the type of
leadership exhibited by managers. Organizational behavior allows us to understand that as a leader of a virtual team, one must foster trust, encourage open
dialogue, and clarify guidelines. Clearly, then, an understanding of organizational behavior can play a vital role in managerial work. To most effectively use
the knowledge provided by this field, managers must thoroughly understand
its various concepts, assumptions, and premises. To provide this foundation, we
next tie organizational behavior even more explicitly to management and then
turn to a more detailed examination of the manager’s job itself.
THE MANAGERIAL CONTEXT OF
ORGANIZATIONAL BEHAVIOR
Virtually all organizations have managers with titles such as chief financial
officer, marketing manager, director of public relations , vice president for
human resources, and plant manager. But probably no organization has a
position called “organizational behavior manager.” The reason for this is simple: Organizational beha vior is not a defined business function or area of
responsibility similar to finance or marketing . Rather, an understanding of
OB provides a set of insights and tools that all managers can use to carry out
their jobs more effectively. The managerial context of OB can viewed from the
perspective of basic management functions, critical management skills, and
overall human resource management.
Basic Management Functions and
Organizational Behavior
Managerial work is fraught with complexity and unpredictability and enric hed
with opportunity and excitement. However, in characterizing managerial work,
most educators and other experts find it useful to conceptualize the activities
performed by managers as reflecting one or more of four basic functions . These
functions are generally referred to as planning, organizing, leading, and controlling. While these functions are often described in a sequential manner, in reality,
of course, most managerial work involves all four functions simultaneously.
Similarly, organizations use many different resources in the pursuit of
their goals and objectives. As with management functions, though, these
resources can also generally be classified into four groups: human, financial,
physical, and/or information resources. As illustrated in Figure 1.2, managers
combine these resources through the four basic functions , with the ultimate
purpose of efficiently and effectively attaining the goals of the organization.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 1 | An Overview of Organizational Behavior
11
Figure 1.2
Basic Managerial Functions
Planning
Organizing
Leading
Controlling
Human
Resources
Financial
Resources
Managers engage in the
four basic functions of
planning, organizing,
leading, and controlling.
These functions are
applied to human,
financial, physical, and
information resources
with the ultimate
purpose of efficiently
and effectively attaining
organizational goals.
Physical
Resources
Information
Resources
Effective and Efficient Attainment
of Organizational Goals
That is, the figure shows how managers apply the basic functions across
resources to advance the organization toward its goals.
Planning, the first managerial function, is the process of determining the
organization’s desired future position and deciding how best to get there. The
planning process at Urban Outfitters, for example, includes studying and analyzing the environment, deciding on appropriate goals, outlining strategies for
achieving those goals, and developing tactics to help execute the strategies .
OB processes and characteristics pervade each of these activities. Perception,
for instance, plays a major role in environmental scanning, and creativity and
motivation influence how managers set goals, strategies, and tactics for their
organization. Larger corporations such as Walmart and Starbucks usually rely
on their top management teams to handle most planning activities. In smaller
firms, the owner usually takes care of planning.
The second managerial function is organizing—the process of designing
jobs, grouping jobs into manageable units, and establishing patterns of authority among jobs and groups of jobs. This process produces the basic structure, or
framework, of the organization. For large organizations suc h as Apple and
Toyota, that structure can be incredibly complex. The structure includes several hierarchical layers and spans myriad activities and areas of responsibil ity. Smaller firms can often function with a relatively simple and
straightforward form of organization. As noted earlier, the processes and characteristics of the organization itself are a major theme of organizational
behavior.
Leading, the third major managerial function, is the process of motivating members of the organization to work together tow ard the organization’s
goals. An Old Navy store manager, for example, must hire people, train them,
planning
The process of
determining an
organization’s desired
future position and the
best means of getting
there
organizing
The process of designing
jobs, grouping jobs into
units, and establishing
patterns of authority
between jobs and units
leading
The process of getting the
organization’s members
to work together toward
the organization’s goals
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
12
PART 1 | Introduction to Organizational Behavior
Leading is a major part of the jobs of most managers. This
manager is presenting information to his team in an effort to
lead them to perform at a higher level.
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and motivate them. Major components of
leading include motivating employees, managing group dynamics, and the actual process of
leadership itself. These are all closely related
to major areas of organizational beha vior. All
managers, whether they work in a huge multinational corporation spanning dozens of coun tries or in a small neighborhood business
serving a few square city blocks, must understand the importance of leading.
The fourth managerial function, controlling,
is the process of monitoring and correcting the
actions of the organization and its people to keep
them headed tow ard their goals. A manager at Best Buy has to control costs,
inventory, and so on. Again, behavioral processes and characteristics are a key
part of this function. Performance evaluation and reward systems, for example, both apply to control. Control is of vital importance to all businesses, but it
may be especially critical to smaller ones. Target, for example, can withstand
with relative ease a loss of several thousand dollars due to poor control, but an
equivalent loss may be devastating to a small firm.
controlling
The process of monitoring
and correcting the actions
of the organization and
its members to keep them
directed toward their goals
technical skills
The skills necessary to
accomplish specific tasks
within the organization
Critical Management Skills and
Organizational Behavior
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Another important element of managerial work is mastery of the skills neces sary to carry out basic functions and fill fundamental roles . In general, most
successful managers have a strong combination of
technical, interpersonal, conceptual, and diagnostic skills.14
Technical skills are skills necessary to
accomplish specific tasks within the organiza tion. Designing a new mobile game app for Rovio,
the company that created Angry Birds, developing a new weight loss supplement for Advocare, or
writing a press release for Halliburton about the
firm’s new drilling technologies all require technical skills. Hence, these skills are generally associated w ith t he o perations e mployed b y th e
Technical skills are the skills needed to perform specific tasks. This
retail manager is teaching a new sales clerk how to operate the
store’s payment system. He has to have the the technical skills
needed for this task in order to teach others.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 1 | An Overview of Organizational Behavior
13
AMY
LTD / AL
Ursula Burns, Chairman and CEO of Xerox Corporation, started her career as a
mechanical engineer. She subsequently moved into management and now leads a
major corporation.
organization in its production processes. For example, the Chairman
and CEO of Xerox Corporation, Ursula Burns, began her career with
the company as a mechanical engineering intern. Other examples of
managers with strong technical skills include Rex Tillerson (CEO of
ExxonMobil, who began his career as a production engineer) and
Andrew Taylor (former CEO of Enterprise Holdings , who began his
career washing cars on Rent-A-Car lots when he w as 16 years of age).
The CEOs of the Big Four accounting firms also began their careers as
accountants.
Managers use interpersonal skills to communicate with, understand, and motivate individuals and groups. As we have noted, managers
spend a large portion of their time interacting with others , so it is clearly
important that they get along well with other people . For instance, Howard Schultz is the CEO of Starbucks. Schultz is able to relate to employees
by demonstrating respect and dignity. Schultz remains committed to providing health benefits despite rising healthcare costs and has created educational
opportunities for Starbucks partners to finish school. Schultz has been recognized for his passion and leadership. These qualities inspire others throughout the organization and motivate them to work hard to help Starbucks reach
its goals.
Conceptual skills are the manager’s ability to think in the abstract.
A manager with strong conceptual skills is able to see the “big picture.” That
is, she or he can see opportunity where others see roadblocks or problems.
For example, after Steve Wozniak and Steve Jobs built a small computer of
their own design in a garage, Wozniak essentially saw a new toy that could
be tinkered with. Jobs, however, saw far more and convinced his partner
that they should start a company to make and sel l the computers . The
result? Apple Computer. In subsequent years, Jobs also used his conceptual
skills to identify the potential in digital media tec hnologies, leading to the
introduction of such products as the iPod, the iPhone, iTunes, and the iPad
as well as his overseeing the creation of Pixar Animation Studios. When he
died in 2011 J obs was hailed as one of the most innovative managers of
all time.
Most successful managers also bring diagnostic skills to the organization.
Diagnostic skills allow managers to better understand cause-and-effect relationships and to recognize the optimal solutions to problems . For instance,
when Ed Whitacre was chairman and CEO of SBC Communications, he recognized that, though his firm was performing well in the consumer market, it
lacked strong brand identification in the business environment. He first carefully identified and then implemented an action to remedy the firm’ s
­shortcoming—SBC would buy AT&T (for $16 billion), acquiring in the process
the very name recognition that his company needed. After the acquisition was
completed, the firm changed its corporate name from SBC to AT&T. And it was
WENN
interpersonal skills
The ability to effectively
communicate with,
understand, and motivate
individuals and groups
conceptual skills
The ability think in the
abstract
diagnostic skills
The ability to understand
cause-and-effect
relationships and to
recognize the optimal
solutions to problems
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
14
PART 1 | Introduction to Organizational Behavior
Whitacre’s diagnostic skills that pulled it all together.15 Indeed, his legacy of
strong diagnostic skills led to his being asked to lead the corporate turnaround
at General Motors in 2009.
Organizational Behavior and
Human Resource Management
IMPROVE YOUR SKILLS
OB RELATED JOB INTERVIEW QUESTIONS
1. What do you think is the most important thing that a
manager does?
2. What was the most ethical decision you’ve had to
make at work?
3. Tell me about a conflict you’ve experienced at work
and how you handled it.
4. Tell me about a challenging team experience you
have had and how you handled it.
5. How would you manage an employee who misses
performance goals?
6. How would you describe your leadership style?
7. How do you deal with stressful deadlines at work?
8. Have you ever dealt with a difficult boss? If so, how
did you manage the situation? If not, what would you
do if you found yourself in this situation?
9. What types of innovative problem-solving or decisionmaking techniques do you use at work?
10. What type of organizational culture would be the best
fit for you? Why?
ILDOGESTO/SHUTTERSTOCK.COM
human resource
management (HRM)
The set of organizational
activities directed at
attracting, developing,
and maintaining an
effective workforce
We noted earlier than OB is generally related to all areas of an organization.It is
especially relevant, though, to human resource management. Human resource
management (HRM) is the set of organizational activities directed at attracting, developing, and maintaining an effective workforce. More precisely, HR managers select new employees, develop rewards and incentives to motivate and
retain employees, and create programs for training and developing employees .
But how do they know which applicants to hire? And how do they know which
rewards will be more motivating than others? The answers to these and related
questions are generally drawn from the field of OB . For example, personality
traits (covered in Chapter 3) are frequently used in selection decisions. Likewise,
motivation theories (as discussed in Chapters 5 and 6) help managers under stand how to most effectively rew ard and retain employees . This chapter’s
Improve Your Skills feature highlights some common job interview questions
that you should be prepared to answer before interviewing for your next job .
These questions and your answers to them all involve OB concepts.
Consider, for example, a recent announcement made by Walmart. In early
2015 the giant retailer began giving pay raises to 500,000 U.S. workers. At the
same time, the company indicated that it was changing the methods it uses to
hire and train new employees.16 Clearly, Walmart did not make the decision to
raise its labor costs lightly. Instead, its managers expect that the higher wages
and new HR practices will enable the company to better recruit new employ ees and retain its existing ones . Hence, this significant—and expensive— ­
decision by Walmart managers had its origins in theories and researc h from
OB and will be implemented in the firm through human resource management.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 1 | An Overview of Organizational Behavior
15
The Walmart example also provides a preview of the
­strategic context of OB, explored in our next section.
THE STRATEGIC CONTEXT OF
ORGANIZATIONAL BEHAVIOR
AGES
Walmart recently announced plans to raise the hourly pay rates for
500,000 of its U.S. employees. The retailer expects its higher wages
to make it easier to hire new employees and retain existing ones.
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Successful business strategies are grounded in creating and
maintaining a su stainable competitive advantage, which
exists any time an organization has an edge over rivals in
attracting customers and defending itself against competition.
The effective management of people is key to the creation of a
competitive advantage and business strategy execution. As former
General Electric CEO J ack Welch said, “We now know where
­productivity—real and limitless productivity—comes from. It
comes from challenged, empowered, excited, rewarded teams of
people.”17 We now turn our attention more specifically to the nature
of management and is relationship to OB.
Sources of Competitive Advantage
How does an organization gain a competitive advantage? Mic hael Treacy
and Fred Wiersma have identified many sources of competitive advantage
including having the best-made or cheapest product, providing the best
customer service, being more convenient to buy from, having shorter product development times, and having a well-known brand name.18 Because it
is an organization’s people who are responsible for gaining and keeping
any competitive advantage, effective management is critical to business
success.19
Warehouse retailer Costco’s strong and loyal customer base, access to a
broad range of high-quality products for a low price, and committed employees
give it a competitive advantage over smaller and lesser -known retailers.
Although Costco pays its employees substantially more than its closest competitor, Sam’s Club, it has similar financial returns on its labor costs due to
lower turnover and higher levels of employee productivity .20 This, in turn,
results in a higher-quality customer experience.
According to Michael Porter, to have a competitive advantage a company
must ultimately be able to give customers superior value for their money (a
combination of quality, service, and acceptable price)—either a better product
that is worth a premium price or a good product at a lower price can be a
source of competitive advantage.21 Table 1.1 lists some possible sources of
competitive advantage. You should note that an organization’ s talent is the
key to securing each of these.
competitive advantage
Anything that gives a firm
an edge over rivals in
attracting customers and
defending itself against
competition
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
PART 1 | Introduction to Organizational Behavior
Table 1.1
Businesses can choose to pursue competitive advantage by using an
array of different sources.
•
Innovation: developing new products, services, and markets and improving
current ones
•
Distribution: dominating distribution channels to block competition
•
Speed: excelling at getting your product or service to consumers quickly
•
Convenience: being the easiest for customers to do business with
•
First to market: introducing products and services before competitors
•
Cost: being the lowest-cost provider
•
Service: providing the best customer support before, during, or after the sale
•
Quality: providing the highest-quality product or service
•
Branding: developing the most positive image
One of the most important things managers do is execute a firm’ s business
strategy. We next discuss business strategy in more detail, as well as how OB can
reinforce the organization’s overall business strategy and support its execution.
A company may create value based on price , technological leadership, customer service, or some combination of these and other factors . Business strategy
involves the issue of how to compete , but also
encompasses:
• The strategies of different functional areas in the firm
• How changing industry conditions such as deregulation, product market maturity, and changing customer
demographics will be addressed
• How the firm as a whole will address the range of strategic issues and choices it faces
Business strategies are partially planned, and partially
reactive to changing circumstances. A large number of possible strategies exist for any organization, and an organization may pursue different strategies in different business
units. Companies may also pursue more than one strategy
at a particular time. According to Michael Porter, businesses
can compete successfully by being the cheapest producer, by
IR WAL
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AGES
Types of Business Strategies
ALASTA
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Sam’s Club and Costco are major competitors but have very different
approaches to competitive advantage. Sam’s Club pays its workers
relatively lower wages in order to keep its costs and prices lower. Costco
pays higher wages, though, in order to hire more more experienced
employees and provide better customer service.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 1 | An Overview of Organizational Behavior
17
making unique products valued by consumers, or by applying their expertise
in a narrow market segment to meet that segment’s particular product or service needs.22 These three primary business strategies are:
1. Cost leadership
2. Differentiation
3. Specialization
Another strategic choice is whether to grow the business, and if so how to do it.
We next discuss each of these strategies and their implications for OB.
Cost Leadership Strategy
Firms pursuing a cost leadership strategy strive to be the lowest-cost producer in an industry for a particular level of product quality. These businesses
are typically good at designing products that can be efficiently manufactured
(e.g., designing products with a minimum number of parts needing assembly)
and engineering efficient manufacturing processes to keep production costs
and customer prices low. Walmart is a good example of a firm that uses a cost
leadership strategy.
Organizations pursuing a strategy of keeping costs and prices low try to
develop a competitive advantage in operational excellence. Employees in
these firms need to identify and follow efficient processes and engage in continuous improvement. Manufacturing and transportation companies frequently
adopt this approach. These organizations continually look for ways to modify
their operational systems in order to reduce costs and lower prices while offering a desirable product that competes successfully with competitors’ products.
Dell Computers, Federal Express, and Walmart are good examples of compa nies whose competitive advantage is based on operational excellence.
Most operationally excellent firms require managers to hire and train
flexible employees who are able to focus on shorter-term production objectives,
who avoid waste, and who are concerned about minimizing production costs.23
Operationally excellent organizations function with tight margins and rely
more on teamwork than individual performance.
operational excellence
Maximizing the efficiency
of the manufacturing or
product development
process to minimize costs
differentiation strategy
Developing a product or
service that has unique
characteristics valued by
customers
ES
OLGA B
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HUTTE
STOCK.C
OM
Differentiation Strategy
A differentiation strategy calls for the development of a product or
service with unique c haracteristics valued by customers . The value
added by the product’s uniqueness may enable the business to charge a
premium price for it. The dimensions along which a firm can differentiate include image (Coca-Cola), product durability (Wrangler c lothing),
quality (Lexus), safety (Volvo), and usability (Apple Computer). Some
companies, such as Southwest Airlines, differentiate themselves from
their competitors by pursuing a strategy based on only providing no-frills,
basic products and services at a low cost. Companies can pursue more
than one strategy at a time. In this case, Southwest Airlines is both a cost
leader and a differentiator.
cost leadership strategy
Striving to be the lowestcost producer for a
particular level of product
quality
Lexus uses a differentiation strategy. It promotes its automobiles as being higher in quality
than those sold by competitors. This differentiation, in turn, allows Lexus to sell its automobiles
for premium prices.
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18
PART 1 | Introduction to Organizational Behavior
product innovation
Developing new products
or services
specialization strategy
Focusing on a narrow
market segment or niche
and pursuing either a
differentiation or cost
leadership strategy within
that market segment
customer intimacy
Delivering unique and
customizable products
or services to meet
customers’ needs and
increase customer loyalty
Organizations pursuing a differentiation strategy often try to develop a
competitive advantage based on product innovation. This requires employees to continually develop new products and services to create an advantage in
the market. These companies create and maintain a culture that encourages
employees to bring new ideas into the company. These companies then listen
to and consider these ideas, however unconventional they might be. For these
companies, the frequent introduction of new products is key to sta ying competitive. This strategy is common in tec hnology and pharmaceutical companies. Johnson & Johnson, Nike, and 3M are good examples of organizations
whose competitive advantage is based on product innovation.
Product innovators must protect their entrepreneurial environment.To that
end, managers develop and reinforce an innovative culture. Instead of selecting
job candidates based only on their related experience, they also assess whether
a candidate can work cooperatively in teams and whether the candidate is openminded and creative.24 An organization with a product innovation competitive
advantage would likely seek a core workforce of researc h and development
employees who have an entrepreneurial mindset, long-term focus, high tolerance for ambiguity, and an interest in learning and discovery. Employees who
need stability and predictability would not fit as well. Managers in innovative
companies also need to motivate and empower employees.25
Specialization Strategy
Businesses pursuing a specialization strategy focus on a narrow market
segment or niche—a single product, a particular end use, or buyers with special needs—and pursue either a differentiation or cost leadership strategy
within that market segment. Successful businesses following a specialist
strategy know their market segment very well, and often enjoy a high degree
of customer loyalty. This strategy can be successful if it results in either lower
costs than competitors serving the same niche, or an ability to offer customers
something other competitors do not (e.g., manufacturing nonstandard parts).
Chuck E. Cheese, Dunkin’ Donuts, and Starbucks are examples of companies
that use a specialization strategy.
Organizations pursuing a specialization strategy often try to develop a competitive advantage based on customer intimacy and try to deliver unique and
customizable products or services to meet their customers’ needs and increase customer loyalty. This approach involves dividing markets into segments or niches
and then tailoring the company’s offerings to meet the demands of those nic hes.
Creating customer loyalty requires employees to combine detailed knowledge
about their customers with operational flexibility so they can respond quic kly to
almost any customer need, from customizing a product to fulfilling special requests.
Consulting, retail, and banking organizations often adopt this approach.
Most service-quality experts say that talent is the most critical element in
building a customer-oriented company.26 Hiring active learners with good customer relations skills and emotional resilience under pressure would comple ment a customer intimacy competitive advantage, and help ensure that the
organization continually enhances its ability to deliver on promises to customers.27 Because employee cooperation and collaboration are important to developing customer intimacy, managers should also focus on building effective
teams and creating effective communication channels.
Companies such as Starbucks are able to get a high price for their products
because of their focus on customer relationships . Imagine if Starbucks began to
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CHAPTER 1 | An Overview of Organizational Behavior
hire cheaper labor, including people with weak communication skills, and cut back
on its investments in employee training and satisfaction. Starbucks’ competitive
advantage would quickly erode, and the company would have to reduce the price of
its coffee to keep customers coming back. This could eventually result in Starbucks
pursuing a cost leadership strategy rather than a specialization strategy because
they failed to attract, motivate, and retain the right types of employees.
Growth Strategy
Another strategic choice is whether to expand the company and seek to increase
business. Companies often pursue a growth strategy in response to investor
preferences for rising earnings per share, and the required business expansion
generally requires the acquisition of additional talent. For example, growth-­
oriented chains such as Chipotle Mexican Grill regularly open new stores that
require additional management, employees, and even product distribution staff.
The success of a growth strategy depends on the firm’ s ability to find and
retain the right number and types of employees to sustain its intended growth.
Growth can be organic, happening as the organization expands from within by
opening new factories or stores. If it is, it requires an investment in recruiting,
selecting, and training the right people to expand the company’ s operations.
Firms can also pursue growth strategies through mergers and acquisitions .
Mergers and acquisitions ha ve been a common w ay for organizations to
achieve growth, expand internationally, and respond to industry deregulation.
In addition to expanding the organization’ s business, mergers and acquisi tions can also be a way for an organization to acquire the quality and amount
of talent it needs to execute its business strategy.
When using mergers and acquisitions as a w ay to implement a growth
strategy, it is important to consider the match between the two organizations’
cultures, values, and organizational structures. Mismatches between merged
or acquired organizations can result in underperformance and the loss of talented employees. Mergers and acquisitions often fail because of culture issues
rather than technical or financial issues.28 The failed DaimlerChrysler, HP and
Compaq, and AOL-Time Warner mergers are just a few prominent examples.
growth strategy
Company expansion
organically or through
acquisitions
Connecting Business Strategy to
Organizational Behavior
There are a number of significant linkages that connect business strategy and
OB. For instance, a firm that relies on a cost leadership strategy will usually need
to keep all of its expenses as low as possible. Therefore, this strategy might dictate
relying on low-wage employees and trying to automate as many jobs as possible .
These actions, in turn, clearly relate to employee motivation and the design of
work. Likewise, a company using a differentiation strategy might want to emphasize exemplary customer service. As a result, it needs employees who are motivated to provide high levels of service, leaders who can help develop a customer
service culture, and a reward structure tied to customer service. A specialization
strategy often requires employees with ­specialized skills and abilities.
Strategy implementation and strategic c hange require also require largescale organizational changes; two of the largest may be the new organizational
culture and new behaviors required of employees. Depending on the nature of a
strategic change, some employees are likely to lack the willingness or even the
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19
20
PART 1 | Introduction to Organizational Behavior
ability to support the new strategy. Targeting management efforts to coach, motivate, and influence the people who are critical to implementing a new strategy
may help it to take hold and ultimately influence the strategy’s effectiveness.
Imagine an organization currently manufacturing semiconductor c hips.
The competitive environment is such that the organization must compete on
cost. The organization is focused on operational efficiencies to control expenses.
Its focus is on keeping costs contained, and the culture reinforces strict adherence to operating rules to help achieve these goals. Now consider what would
change if the organization were to identify a better competitive position by
specializing in designing new and innovative computer chips and outsourcing
their production. The organization’s focus would now be on innovation, problem solving, and teamwork. Managers would need to do less rule enforcement
and more leading, motivating, and communicating. Employee involvement in
decision making might also increase. Intel went through this type of transformation in the early 1970s when it moved from being a producer of semicon ductor memory chips to programmable microprocessor chips.
The previous discussion should help you to understand the role of OB in
executing a variety of business strategies . Effective managers understand
what needs to be done to execute a company’s business strategy, then they
plan, organize, direct, and control the activities of employees to get it done . It
is important to note that managers do not accomplish organizational objectives by themselves—they get work done through others . Flexibly applying
OB principles will help you to do that most effectively.
CONTEXTUAL PERSPECTIVES ON
ORGANIZATIONAL BEHAVIOR
Several contextual perspectives—most notably the systems and contingency
perspectives and the interactional view—also influence our understanding of
organizational behavior. Many of the concepts and theories discussed in the
chapters that follow reflect these perspectives; they represent basic points of
view that influence muc h of our contemporary thinking about beha vior in
organizations. In addition, they allow us to see more clearly how managers use
behavioral processes as they strive for organizational effectiveness . Before
examining these perspectives, though, let’s first take a detour to explain how
the field of OB has developed.
Where Does Organizational Behavior Come From?
OB could date back to prehistoric times, when people first started trying to
understand, motivate, and lead others. The Greek philosopher Plato contemplated the essence of leadership, and Aristotle discussed persuasive communication. The foundation of organizational power and politics can be found in the
more than 2,300-year-old writings of Sun-Tzu and those of 16th-century Ital ian philosopher Machiavelli. Charismatic leadership was later discussed by
German sociologist Max Weber. OB topics ha ve clearly been of interest to
many people for a long time. Let’s briefly review some history to better understand the origins of the scientific study of OB.
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CHAPTER 1 | An Overview of Organizational Behavior
21
/GETTY
Formal study of OB began in the 1890s, following the industrial relations movement spawned by Adam Smith’s introduction of the division of
labor. In the 1890s, Frank and Lillian Gilbreth and Frederick Winslow Taylor
identified the positive effects of precise instructions, goal setting, and rewards
on motivation. Their ideas became known as scientific management,
and are often considered the beginning of the formal study of OB.
Scientific management is based on the belief that productivity is maximized when organizations are rationalized with precise sets of instructions
based on time-and-motion studies. The four principles of Taylor’s scientific
management are:29
IMAGES
Frederick Winslow Taylor was one of the pioneers of scientific management. He advocated
that managers should study the jobs of workers, break those jobs down into small tasks,
train workers in the “one best way” of doing their jobs, and then pay workers based on
the number of units they produced.
IN BILD
1. Replace rule-of-thumb work methods with methods based on scientifi cally studying the tasks using time-and-motion studies.
2. Scientifically select, train, and develop all workers rather than lea ving
them to passively train themselves.
3. Managers provide detailed instructions and supervision to workers to
ensure that they are following the scientifically developed methods.
4. Divide work nearly equally between workers and managers. Managers
should apply scientific management principles to planning the work, and
workers should actually perform the tasks.
ULLSTE
Although scientific management improved productivity, it also increased
the monotony of work. Scientific management left no room for individual preferences or initiative, and was not always accepted by workers. At one point,
complaints that it was dehumanizing led to a congressional investigation. 30
After World War I, attention shifted to understanding the role of human fac tors and psychology in organizations. This interest was spawned by the discovery of the Hawthorne effect in the 1920s and 1930s. The Hawthorne effect
occurs when people improve some aspect of their behavior or performance simply because they know they are being assessed. This effect was first identified
when a series of experiments that came to be known as the Hawthorne studies
were conducted on Western Electric plant workers in Hawthorne, just outside
of Chicago, to see the effects of a variety of factors, including individual versus
group pay, incentive pay, breaks, and snacks, on productivity.
One of the working conditions tested at the Hawthorne plant was lighting.
When they tested brighter lights, production increased. When they tested dimmer lights, production also increased! Researchers observed that productivity
almost always improved after a lighting change—any change—but eventually
returned to normal levels. Workers appeared to try harder when the lights
were dimmed just because they knew they were being evaluated.George Elton
Mayo, founder of the human relations movement initiated by the Hawthorne
studies, explained this finding by saying that the workers tried harder because
of the sympathy and interest of the observers. Mayo stated that the reason
workers are more strongly motivated by informal things is that individuals
have a deep psychological need to believe that their organization cares about
them.31 Essentially, workers are more motivated when they believe their organization is open, concerned, and willing to listen.
scientific management
Based on the belief that
productivity is maximized
when organizations are
rationalized with precise
sets of instructions based
on time-and-motion
studies
Hawthorne effect
When people improve
some aspect of their
behavior or performance
simply because they are
being assessed
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22
PART 1 | Introduction to Organizational Behavior
human relations
movement
Views organizations
as cooperative systems
and treats workers’
orientations, values, and
feelings as important
parts of organizational
dynamics and
performance
The Hawthorne studies prompted further investigation into the effects of
social relations, motivation, communication, and employee satisfaction on factory productivity. Rather than viewing workers as interc hangeable parts in
mechanical organizations as the scientific management movement had done ,
the human relations movement viewed organizations as cooperative systems
and treated workers’ orientations, values, and feelings as important parts of
organizational dynamics and performance . The human relations movement
stressed that the human dimensions of work, including group relations, can
supersede organizational norms and even an individual’s self-interests.
Unsophisticated research methods did render some of the conc lusions of
human relations researchers incorrect.32 For example, the relationship between
employee satisfaction and performance is more complex than researc hers initially thought. Nonetheless, the movement ushered in a new era of more
humane, employee-centered management by recognizing employees’ social
needs, and highlighted the importance of people to organizational success.
Harvard social work professor and management consultant Mary P arker
Follett was known as a “prophet of management” because her ideas were ahead
of her time. Follett discovered a variety of phenomena, including creativity exercises such as brainstorming, the “groupthink” effect in meetings (in which faulty
decisions are made because group members try to minimize conflict and reac h
consensus by neglecting to critically analyze and test ideas), and what later
became known as “management by objectives” and “total quality management.”
Follett also advocated for power-sharing arrangements in organizations. In the
1950s, Japanese managers discovered her writings. They credit her ideas, along
with those of W. Edwards Deming, in revitalizing their industrial base.
W. Edwards Deming is known as the “guru of quality management.” In
postwar Japan, Deming taught Japanese industrialists statistical process control and quality concepts. His classic 1986 book 33 describes how to do highquality, productive, and satisfying work. Deming’s plan-do-check-act cycle of
continuous improvement promoted the adoption of fourteen principles to make
any organization efficient and capable of solving almost any problem. Deming
believed that removing fear from the workplace gives employees pride in their
workmanship, which increases production. Deming also felt that when things
go wrong, there is a 94 percent chance that the system (elements under managerial control including machinery and rules) rather than the worker is the
cause.34 He believed that making c hanges in response to normal variations
was unwise, and that a proper understanding of variation inc ludes the mathematical certainty that variation will normally occur within a certain range .
The total quality management movement initiated by Deming again high lights the importance of people, teamwork, and communication in an organization’s success. You will read much more about the evolution of OB throughout
this book, but this brief history helps to set the stage for how we got this far .
We now turn our attention to other important contextual perspectives that
help us understand both organizations and the beha viors of individuals that
comprise them.
Organizations as Open Systems
The systems perspective, or the theory of systems, was first developed in the
physical sciences , but it has been extended to other areas , suc h as
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CHAPTER 1 | An Overview of Organizational Behavior
23
Figure 1.3
The Systems Approach to Organizations
Feedback
Inputs
Material Inputs
Human Inputs
Financial Inputs
Information Inputs
Transformation
Technology
(including manufacturing,
operations, and
service processes)
Outputs
Products/Services
Profits/Losses
Employee Behaviors
New Information
Environment
management.35 A system is an interrelated set of elements that function as a
whole. Figure 1.3 shows a general framework for viewing organizations as
systems.
According to this perspective, an organizational system receives four kinds
of inputs from its environment: material, human, financial, and informational
(note that this is consistent with our earlier description of management func tions). The organization’s managers then combine and transform these inputs
and return them to the environment in the form of products or services,
employee behaviors, profits or losses, and additional information. Then the
system receives feedback from the environment regarding these outputs.
As an example, we can apply systems theory to the Shell Oil Company.
Material inputs include pipelines, crude oil, and the machinery used to refine
petroleum. Human inputs are oil field workers, refinery workers, office staff,
and other people employed by the company. Financial inputs take the form of
money received from oil and gas sales, stockholder investment, and so forth.
Finally, the company receives information inputs from forecasts about future
oil supplies, geological surveys on potential drilling sites , sales projections,
and similar analyses.
Through complex refining and other processes, these inputs are combined
and transformed to create products such as gasoline and motor oil. As outputs,
these products are sold to the consuming public . Profits from operations are
fed back into the environment through taxes , investments, and dividends;
losses, when they occur , hit the environment by reducing stoc kholders’
incomes. In addition to having on-the-job contacts with customers and suppliers, employees live in the community and participate in a variety of activities
away from the workplace , and their beha vior is influenced in part by their
experiences as Shell workers. Finally, information about the company and its
operations is also released into the environment. The environment, in turn,
responds to these outputs and influences future inputs. For example, consumers may buy more or less gasoline depending on the quality and price of Shell’s
The systems approach to
organizations provides
a useful framework for
understanding how
the elements of an
organization interact
among themselves and
with their environment.
Various inputs are
transformed into different
outputs, with important
feedback from the
environment. If managers
do not understand
these interrelations,
they may tend to ignore
their environment or
overlook important
interrelationships within
their organizations.
system
A set of interrelated
elements functioning as
a whole
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24
PART 1 | Introduction to Organizational Behavior
product, and banks may be more or less willing to lend Shell money based on
financial information released about the company.
The systems perspective is valuable to managers for a variety of reasons.
First, it underscores the importance of an organization’ s environment. For
instance, failing to acquire the appropriate resources and failing to heed feedback from the environment can be disastrous . The systems perspective also
helps managers conceptualize the flow and interaction of various elements of
the organization itself as they work together to transform inputs into outputs.
Situational Perspectives on
Organizational Behavior
situational perspective
Suggests that in most
organizations, situations
and outcomes are
influenced by other
variables
Another useful viewpoint for understanding behavior in organizations comes
from the situational perspective. In the earlier days of management studies,
managers searched for universal answers to organizational questions . They
sought prescriptions, the “one best way” that could be used in any organization
under any conditions, searching, for example, for forms of leadership behavior
that would always lead employees to be more satisfied and to work harder.
Eventually, however, researchers realized that the complexities of human
behavior and organizational settings make universal conclusions virtually
impossible. They discovered that in organizations , most situations and out comes are contingent; that is, the precise relationship between any two vari ables is likely to be situational (i.e., dependent on other variables).36
Figure 1.4 distinguishes the universal and situational perspectives . The
universal model, shown at the top of the figure, presumes a direct cause-andeffect linkage between variables. For example, it suggests that whenever a
manager encounters a particular problem or situation (suc h as motivating
employees to work harder), a universal approach exists (such as raising pay or
increasing autonomy) that will lead to the desired outcome. The situational
perspective, on the other hand, acknowledges that several other variables
Figure 1.4
Managers once believed
that they could identify
the “one best way” of
solving problems or
reacting to situations.
Here we illustrate a
more realistic view, the
situational approach.
The situational approach
suggests that approaches
to problems and
situations are contingent
on elements of the
situation.
Universal Versus Situational Approach
Universal Approach
Organizational
problems or situations
determine . . .
the one best way
of responding.
Situational Approach
Organizational
problems or situations
must be evaluated in
terms of . . .
elements of the
situation, which
then suggest . . .
contingent or
situational ways
of responding.
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CHAPTER 1 | An Overview of Organizational Behavior
25
alter the direct relationship . In other words , the appropriate managerial
action or behavior in any given situation depends on elements of that situation. The field of organizational behavior has gradually shifted from a universal approach in the 1950s and early 1960s to a situational perspective . The
situational perspective has been widely documented in the areas of motiva tion, job design, leadership, and organizational design, and it is becoming
increasingly important throughout the entire field.
Interactionalism: People and Situations
Interactionalism is another useful perspective to help better understand
behavior in organizational settings. First presented in terms of interactional
psychology, this view assumes that individual behavior results from a continuous and multidirectional interaction between characteristics of the person and
characteristics of the situation. More specifically, interactionalism attempts
to explain how people select, interpret, and change various situations.37 Note
that the individual and the situation are presumed to interact continuously.
This interaction is what determines the individual’s behavior.
The interactional view implies that simple cause-and-effect descriptions of
organizational phenomena are not enough. For example, one set of research
studies may suggest that job c hanges lead to improved employee attitudes .
Other studies may propose that attitudes influence how people perceive their
jobs in the first place. Both positions probably are incomplete: Employee attitudes may influence job perceptions, but these perceptions may in turn influence future attitudes. Because interactionalism is a fairly recent contribution
to the field, it is less prominent in the c hapters that follow than the systems
and contingency theories. Nonetheless, the interactional view appears to offer
many promising ideas for future development.
interactionalism
Suggests that individuals
and situations interact
continuously to determine
individuals’ behavior
MANAGING FOR EFFECTIVENESS
Earlier in this chapter, we noted that managers work toward various goals. We
are now in a position to elaborate on the nature of these goals in detail. Essentially, managers and leaders generally try to direct the beha viors of people in
their organizations in ways that promote organizational effectiveness. They
can do this by enhancing behaviors and attitudes, promoting citizenship, minimizing dysfunctional behaviors, and driving strategic execution. Of course, it
may sometimes be necessary to make trade-offs among these different kinds
of outcomes, but in general each is seen as a critical component of organiza tional effectiveness. The sections that follow elaborate on these and other
points in more detail.
Enhancing Individual and Team
Performance Behaviors
First, several individual behaviors result from a person’s participation in an
organization. One important behavior is productivity. A person’s productivity
is a relatively narrow indicator of his or her efficiency and is measured in
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26
PART 1 | Introduction to Organizational Behavior
terms of the products or services created per unit of input. For example, if Bill
makes 100 units of a product in a day and Sara makes only 90 units in a day,
then, assuming that the units are of the same quality and that Bill and Sara
make the same wages, Bill is more productive than Sara.
Performance, another important individual-level outcome variable , is a
somewhat broader concept and is made up of all work-related behaviors. For
example, even though Bill is highly productive, it may also be that he refuses
to work overtime, expresses negative opinions about the organization at every
opportunity, will do nothing unless it falls precisely within the boundaries of
his job, calls in sick frequently, and is often late. Sara, on the other hand, may
always be willing to work overtime, is a positive representative of the organi zation, goes out of her way to make as many contributions to the organization
as possible, and seldom misses work. Based on the full arra y of behaviors,
then, we might conclude that Sara actually is the better performer.
Another set of outcomes exists at the group and team level. Some of these
outcomes parallel the individual-level outcomes just discussed. For example, if
an organization makes extensive use of work teams, team productivity and
performance are important outcome variables. On the other hand, even if all
the people in a group or team have the same or similar attitudes toward their
jobs, the attitudes themselves are individual-level phenomena. Individuals,
not groups, have attitudes. But groups or teams can also ha ve unique outcomes that individuals do not share. For example, as we will discuss in Chapter 7, groups develop norms that govern the beha vior of individual group
members. Groups also develop different levels of cohesiveness. Thus, managers need to assess both common and unique outcomes when considering the
individual and group levels.
Enhancing Employee Commitment
and Engagement
Another set of individual-level outcomes influenced by managers consists of
individual attitudes. Levels of job satisfaction or dissatisfaction, organizational commitment, and employee engagement all pla y an important role in
organizational behavior. Extensive research conducted on job satisfaction has
indicated that personal factors, such as an individual’s needs and aspirations,
determine this attitude, along with group and organizational factors, such as
relationships with coworkers and supervisors, as well as working conditions,
work policies, and compensation. A satisfied employee also tends to be absent
less often, to make positive contributions, and to stay with the organization. In
contrast, a dissatisfied employee may be absent more often, may experience
and express stress that disrupts coworkers, and may be continually looking for
another job. Contrary to what many managers believe, however, high levels of
job satisfaction do not necessarily lead to higher levels of performance.
A person with a high level of commitment is likely to see herself as a true
member of the organization (for example, referring to the organization in personal terms like “We make high-quality products”), to overlook minor sources
of dissatisfaction with the organization, and to see herself remaining a member of the organization. In contrast, a person with less organizational commitment is more likely to see himself as an outsider (for example, referring to the
organization in less personal terms like “They don’t pay their employees very
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CHAPTER 1 | An Overview of Organizational Behavior
27
well”), to express more dissatisfaction about things, and to not see himself as a
long-term member of the organization.
Promoting Organizational Citizenship Behaviors
Organizational citizenship is the behavior of individuals that makes a positive overall contribution to the organization. 38 Consider, for example , an
employee who does work that is acceptable in terms of both quantity and quality. However, she refuses to work overtime, will not help newcomers learn the
ropes, and is generally unwilling to make any contribution to the organization
beyond the strict performance of her job. Although this person may be seen as
a good performer, she is not likely to be seen as a good organizational citizen.
Another employee may exhibit a comparable level of performance. In addition, however, he will always work late when the boss asks him to, take time to
help newcomers learn their way around, and is perceived as being helpful and
committed to the organization’s success. Although his level of performance
may be seen as equal to that of the first worker, he is also likely to be seen as a
better organizational citizen.
The determinant of organizational citizenship behaviors is likely to be a
complex mosaic of individual, social, and organizational variables. For example, the personality, attitudes, and needs of the individual will have to be consistent with citizenship behaviors. Similarly, the social context in whic h the
individual works, or work group , will need to facilitate and promote suc h
behaviors. And the organization itself, especially its culture, must be capable
of promoting, recognizing, and rewarding these types of behaviors if they are
to be maintained. Although the study of organizational citizenship is still in
its infancy, preliminary research suggests that it may play a powerful role in
organizational effectiveness.
organizational citizenship
The behavior of
individuals that makes
a positive overall
contribution to the
organization
Minimizing Dysfunctional Behaviors
Some work-related behaviors are dysfunctional in nature . Dysfunctional
behaviors are those that detract from, rather than contribute to, organizational performance.39 Two other important individual-level behaviors are
absenteeism and turnover. Absenteeism is a measure of attendance. Although
virtually everyone misses work occasionally, some people miss far more than
others. Some look for excuses to miss work and call in sic k regularly just for
some time off; others miss work only when absolutely necessary . Turnover
occurs when a person leaves the organization. If the individual who leaves is a
good performer or if the organization has invested heavily in training the person, turnover can be costly.
Other forms of dysfunctional behavior may be even more costly for an organization. Theft and sabotage, for example, result in direct financial costs for an organization. Sexual and racial harassment also cost an organization, both indirectly
(by lowering morale, producing fear, and driving off valuable employees) and
directly (through financial liability if the organization responds inappropriately).
So, too, can politicized behavior, intentionally misleading others in the organization, spreading malicious rumors, and similar activities. Incivility and rudeness
can result in conflict and damage to morale and the organization’ s culture.40
dysfunctional behaviors
Those that detract from,
rather than contribute
to, organizational
performance
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
PART 1 | Introduction to Organizational Behavior
TERSTO
CK.COM
Dysfunctional behaviors in organizations generally include things
like excessive absenteeism and incivility. Sometimes, though,
employees turn violent. When this happens the workplace can turn
into a crime scene.
Bullying and workplace violence are also growing concerns in many organizations. Violence by disgruntled
workers or former workers results in dozens of deaths
and injuries each year.41 The factors that contribute to
workplace ­violence—not to mention the factors involved
in its increases and decreases—are difficult to pin down
but of obvious importance to managers.
Driving Strategic Execution
I/SHUT
Finally, another set of outcome variables exists at the organization level. These outcomes usually relate to strategic
execution—how well managers and their employees understand and carry out the actions needed to ac hieve strategic
goals. As before, some of these outcomes parallel those at the
individual and group levels, but others are unique. For example, we can measure
and compare organizational productivity. We can also develop organization-level
indicators of absenteeism and turnover. But profitability is generally assessed only
at the organizational level.
Organizations are also commonly assessed in terms of financial performance: stock price, return on investment, growth rates, and so on. They are
also evaluated in terms of their ability to survive and the extent to which they
satisfy important stakeholders suc h as investors, government regulators,
employees, and unions.
Clearly, then, the manager must balance different outcomes across all three
levels of analysis. In many cases , these outcomes appear to contradict one
another. For example, paying workers high salaries can enhance satisfaction
and reduce turnover, but it also may detract from bottom-line performance.
Similarly, exerting strong pressure to increase individual performance ma y
boost short-term profitability but increase turnover and job stress. Thus, the
manager must look at the full array of outcomes and attempt to balance them
in an optimal fashion. The manager’s ability to do this is a major determinant
of the organization’s success and how well it implements its business strategy.
SHI YAL
28
How Do We Know What We Know?
Another important part of being an effective manager is understanding the
quality of the information you use to make decisions. Not all information is
accurate! Accordingly, it is important for you to understand the processes that
have been used to establish our knowledge about OB, and why we know what
we know. People sometimes believe that OB is simply a collection of common
sense ideas because the theories can seem obvious . For example, everyone
“knows” that having higher goals and confidence leads to better performance,
more job satisfaction leads to greater productivity, greater group cohesion will
lead to higher group performance , and valuing rew ards leads to greater
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 1 | An Overview of Organizational Behavior
29
motivation, right? So if it is all common sense , why do we need OB research?
And why do we need to study these theories?
The answer is that common sense isn’t so common. People don’t always
agree. If ten different people see the same leadership interaction you may find
ten different “common sense” perspectives on what leadership is and how it
works. Even if you don’t find ten different perspectives, you will certainly not
find perfect agreement on the same phenomenon. Take two common sense
statements: “Absence makes the heart grow fonder” and “When the cat is away
the mice will play.” Which one is correct? Why?
Another answer is that common sense is not alw ays right. Findings may
seem common sense after the research is done, but beforehand we don’t really
know what is going on. For example, in this book you will learn that eac h of
the common sense statements made earlier is either false or conditional.Goals
and confidence do not always work, satisfaction does not always lead to productivity, cohesion does not always enhance group performance, and having
valued rewards sometimes doesn’t motivate people . So it isn’t just common
sense. We need science and research because it is built on careful and systematic testing of assumptions and conclusions. This process allows us to evolve
our understanding of how things work and it allows us to learn when goals,
confidence, satisfaction, cohesion, and rewards affect outcomes and why it
happens. That is why you need to learn the theories and why you can’t just
operate on common sense.
Intuition
Many people feel that they have a good understanding of other people from
observing them all of their lives. When you want to persuade or motivate a friend
or colleague to do something, for example, you likely use various techniques and
tricks that have worked for you in the past. So why should you study OB?
Although we can certainly develop a good understanding of many of the
norms, expectations, and behaviors of others by living and working with them,
there are many things that are not well understood without more systematic
study. Decades of research have both reinforced some of the things many peo ple intuitively believe and identified common misunderstandings or misper ceptions about OB. For example, when are different leadership approac hes
most effective? What are the advantages and disadvantages of different influence approaches? What goal level will best motivate someone? How important
is employee satisfaction to job performance? Is stress always bad? The answers
to some of these questions may surprise you, and will help make you a more
successful manager.
We encourage you to read this book with an open mind, and to not assume
that you know all there is to know about a topic before you have studied it. Our
goal is to help you be as effective as possible in organizations , and to help you
create successful organizations. Help us help you succeed by being open to challenging and replacing popular but incorrect notions you may have about OB.
The Scientific Method
Rather than relying on experience or intuition, or just assuming that ideas are
correct because they seem to make sense, the scientific method relies on systematic studies that identify and replicate a result using a variety of methods,
samples, and settings. Although he himself was not a distinguished scientist,
Sir Francis Bacon developed the scientific method, shown in F igure 1.5, in
the 1600s.42
scientific method
Method of knowledge
generation that relies on
systematic studies that
identify and replicate a
result using a variety of
methods, samples, and
settings
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
30
PART 1 | Introduction to Organizational Behavior
Figure 1.5
The scientific method
is a useful approach to
learning more about
organizational behavior.
Using theory to develop
hypotheses and then
collecting and studying
relevant data can help
generate new knowledge.
The Scientific Method
1
Theory
4
Verification
2
Hypotheses
3
Data
D
theory
A collection of verbal
and symbolic assertions
that specify how and why
variables are related,
and the conditions under
which they should and
should not relate
hypotheses
Written predictions
specifying expected
relationships between
certain variables
independent variable
The variable that is
predicted to affect
something else
dependent variable
The variable predicted to
be affected by something
else
correlation
Reflects the size and
strength of the statistical
relationship between two
variables; ranges from
−1 to +1
The scientific method begins with theory, which is a collection of verbal
and symbolic assertions that specify how and why two or more variables are
related, and the conditions under which they should and should not relate.43
Theories describe the relationships that are proposed to exist among certain
variables, when, and under what conditions. Until they are proven to be correct, theories are no guarantee of fact. It is important to systematically test
any theory to verify that its predictions are accurate.
The second step in the scientific method is the development of hypotheses,
or written predictions specifying expected relationships between certain vari ables. “Setting a specific goal will be positively related to the number of prod ucts assembled” is an example of a hypothesis (and, in fact, it’s true!). So how
can you test this hypothesis?
Hypothesis testing can be done using a variety of research methods and
statistical analyses. For our purposes, assume we collect data on our predictor, or independent variable, and our criterion, or dependent
­variable. In this hypothetical case, setting a specific, difficult, achievable
goal is the independent variable, and the number of products assembled is
our dependent variable. We identify a representative group of assemblers,
and record their goals and their performance during a one-hour work
period. We can then analyze the correlation, abbreviated r, between the
two variables to test our hypothesis. The correlation reflects the strength of
the statistical relationship between two variables. Rather than answering
a question with a “yes” or “no,” the correlation answers with “how strong
the relationship is.”
The correlation ranges from −1 to +1, and can be positive or negative. A
correlation of 0 means that there is no statistical relationship . We can also
imagine a correlation as a graph. As you can see from Figure 1.6, in the context of our example, a correlation of 0 would mean that setting a goal has no
effect on the number of products assembled, while a correlation of +1 means
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 1 | An Overview of Organizational Behavior
Figure 1.6
Interpreting Correlations
Correlations between variables can range from −1 to +1. By studying correlations we can learn more about how two
variable are related. Correlations of −1 or +1 are unusual, as is a correlation of 0. Fortunately, we can still learn a great
deal from correlations that are statistically significant.
Correlation = 0
Correlation = +1.0
120
120
115
115
110
105
Product Made
Product Made
110
100
95
90
105
100
95
90
85
85
80
80
80
90
100
110
120
80
Goal
90
Correlation = –1.0
110
120
Correlation = + 0.30
120
120
115
115
110
110
Product Made
Product Made
100
Goal
105
100
95
105
100
95
90
90
85
85
80
80
80
90
100
Goal
110
120
80
90
100
110
120
Goal
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
31
32
PART 1 | Introduction to Organizational Behavior
meta-analysis
A statistical technique
used to combine the
results of many different
research studies done in
a variety of organizations
and for a variety of jobs
that there is a perfect positive relationship—the higher the goal, the more
products assembled. A correlation of +1.0 is as strong a positive relationship
as we can get, and shows that we can predict the number of products assem bled perfectly from the level of the assembler’s goals.
As you can also see from Figure 1.6, a correlation of −1.0 is as strong a
negative relationship as we can get. It would indicate that the higher an assembler’s goal, the lower her performance. A negative correlation is not necessarily
bad. In this case, it would simply mean that to maximize assemblers’ perfor mance, the manager should set lower goals (perhaps goals for lower error rates
or faster assembly times). In reality, we never see perfect +1.0 or −1.0 correla tions when it comes to peopl e’s behavior—people are just too complicated.
Nonetheless, being able to visualize what these relationships look like can help
you to understand the relationships. In Figure 1.6, we also include a correlation of +0.30, which is more common in OB research.
The evaluation of relationships between organizational actions and out comes can help organizations execute strategy more effectively and improve
performance. Texas-based Sysco, a marketer and distributor of foodservice
products, is a good example. Reducing customer churn can improve performance for companies in low-margin industries like Sysco’s. Sysco maintains
low fixed costs and periodically conducts customer and associate work-climate surveys to assess and correlate employee satisfaction with customer
satisfaction. The company has found that customer loyalty and operational
excellence are affected by a satisfied, productive , and committed
workforce.44
High employee retention also cuts the cost of operations. Because of the
important relationship it identified between associate satisfaction and com mitment, and the satisfaction of all other constituents (customers, communities, suppliers, and shareholders), Sysco has implemented a rigorous set of
programs to enhance the retention and satisfaction of its employees.45
A statistical technique called meta-analysis is used to combine the results of
many different research studies done in a variety of organizations and for a vari ety of jobs. The goal of meta-analysis is to estimate the true relationship between
various constructs and to determine whether the results can be generalized to all
situations or if the relationship works differently in different situations.
Although meta-analysis can often give useful insights into the strength of
the relationships between the variables in the studies included in the analysis, there is no guarantee that any one organization would find the same relationship. This is because many situational factors exist in every organization
that may drastically impact the strength of the relationship, including differences in the job context and differences in the definition of job success . It is
important to always test hypotheses and validate theories in your own organization before making decisions based on them.
Global Replication
Much of the research on organizational behavior has been done in the United
States; however, what is true for Americans working in the United States
may not be true for anyone else , including non-Americans working in the
United States. Assuming that everyone in the world shares the same values ,
norms, and expectations about work is incorrect. National boundaries no longer limit many organizations, and many U.S. companies employ people from
around the world.
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GLOBAL
33
ISSUES
MANAGING ACROSS CULTURES
Effective management requires flexibility and an appreciation that people’s expectations and values differ. The U.S.
workforce is already very diverse, and is expected to
become even more diverse in coming years. The more
comfortable you are in tailoring your motivation and leadership efforts to the people you want to lead, the more
effective you will be as an employee and as a manager.
Although good pay and interesting work appear to
be universally motivating,46 people from different cultures
have different traditions, are often motivated by different
things, and communicate in different ways. 47 For example, some cultures communicate directly while others are
more reserved. Some cultures put a high value on family life whereas others stress the importance of work. As
one expert puts it, “to understand why people do what
they do, we have to understand the cultural constructs
by which they interpret the world.”48 Clearly, motivating
employees in a multinational organization is challenging,
particularly if managers adopt a “one-size-fits-all” motivation strategy.
Cultural differences also influence the effectiveness
of different leadership behaviors.49 Effective leadership
behaviors are determined by the roles of expectations,
norms, and traditions in the particular society. Managers
supervising employees from different cultures must recognize these differences and adapt their behaviors and relationships accordingly. For example, societies such as the
United States, Sweden, and Germany have small variation
in the distribution of power across supervisors and employees, but others such as Japan and Mexico have a large
power difference. If employees feel that large power differences are legitimate and appropriate, they may be uncomfortable if their supervisor tries to reduce the expected
power difference by acting more friendly and accessible.
In this book, the Global Issues feature in each chapter will highlight global
issues that are relevant to the concepts we discuss . In the Global Issues feature in this chapter, you will learn more about how effective motivation and
leadership vary in different cultures.
THE FRAMEWORK OF THE BOOK
Figure 1.7 presents the framework around which our book is organized. As
you can see, we suggest that organizations and the beha viors of the people
who comprise them all function within an environment context. Both this
chapter and Chapter 2 help establish the key elements of this context. At the
center of the framework we also note several important factors that determine
whether or not managers and organizations are effective. These factors, discussed earlier in this c hapter, involve enhancing performance beha viors,
enhancing commitment and engagement, promoting citizenship beha viors,
and minimizing dysfunctional behaviors.
Operating between the environmental context and the indicators of effectiveness are four sets of factors . One set of factors relate to individuals and
include individual characteristics, individual values, perceptions, and reactions, motivation concepts and models, and the role of work and reward in tapping those motivation concepts and models. The four chapters in Part 2 of the
book discuss these factors in detail.
A second set of factors that determine effectiveness involves groups and
teams. Special considerations here are the role of groups and how
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
BALDYRGAN/SHUTTERSTOCK.COM
CHAPTER 1 | An Overview of Organizational Behavior
34
PART 1 | Introduction to Organizational Behavior
Figure 1.7
Organizational Behavior Framework
An array of environmental, individual, group and team, leadership, and organizational characteristics impact organizational
behavior. If managers understand these concepts and characteristics they can better promote organizational effectiveness.
How does the
environment matter?
Why do individuals
do what they do?
• Individual
characteristics
• Individual values,
perceptions, and
reactions
• Motivating behavior
• Motivating behavior
with work and
rewards
Why does leadership
matter?
• Traditional leadership
approaches
• Modern leadership
approaches
• Power, influence, and
politics
What makes managers
and organizations effective?
• Enhancing performance
behaviors
• Enhancing commitment and
engagement
• Promoting citizenship
behaviors
• Minimizing dysfunctional
behaviors
Why do groups and
teams do what they
do?
• Groups and teams
• Decision making and
problem solving
• Communication
• Conflict and
negotiation
How do
organizational
characteristics
influence
effectiveness?
• Organization structure
and design
• Organization culture
• Change management
How does the
environment matter?
organizations use teams, decision-making and problem-solving processes ,
communication, and diversity. Part 3 includes four chapters that explore these
factors.
Leadership is also of great importance in determining organizational
effectiveness. Traditional leadership models; modern leadership approaches;
power, influence, and politics; and conflict and negotiation are all important
aspects of leadership and are covered in detail in Part 4.
Finally, several factors associated with the organization itself also impact
effectiveness. Organization structure , design, and culture and how the
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CHAPTER 1 | An Overview of Organizational Behavior
organization manages change are the central elements of importance and are
the subject of Part 5.
We believe that this framework will serve as a useful roadmap for you as
you learn about organizational behavior. The framework will be reintroduced
at the beginning of each part in the book. We will use it to both remind you of
where our discussion has taken us and where we are headed next.
SUMMARY AND APPLICATION
Organizational behavior is the study of human beha vior in organizational
settings, the interface between human beha vior and the organization, and
the organization itself. The study of OB is important because organizations
have a powerful influence on our lives . It also directly relates to manage ment in organizations. Indeed, by its very nature, management requires an
understanding of human beha vior to help managers better comprehend
behaviors at different organizational levels, at the same organizational level,
in other organizations, and in themselves.
A manager’s job can be characterized in terms of four functions. These
basic managerial functions are planning, organizing, leading, and controlling. Planning is the process of d etermining the organizations’ desired
future position and deciding how best to get there . Organizing is the process of designing jobs, grouping jobs into manageable units, and establishing patterns of authority among jobs and groups of jobs. Leading is the
process of motivating members of the organization to work together toward
the organization’s goals. Controlling is the process of monitoring and correcting the actions of the organization and its people to keep them headed
toward their goals.
Why is it that some people rise in organizations despite being only
average accountants, marketers, researchers, and so on? Often the answer
is that those people know how to interact effectively with other people .
Effective interaction with people is critical for advancement in organiza tions, and often for effective job performance . Being able to understand
what people think and feel, knowing how to persuade and motivate others,
and knowing how to resolve conflicts and forge cooperation are among the
most important skills of successful leaders. 50 “People skills” are often what
make the difference between an a verage and an excellent performer in
almost any job.
This book can help you better understand yourself, understand organizations, understand the role of organizational behavior in your personal career
success, and improve your OB skills . All we can do, however, is make these
things possible: You need to make them happen. We encourage you to stay
open-minded and receptive to new ideas and to information that disconfirms
some of your current assumptions about people, organizations, and management. By studying the chapters and putting some thought into how you can
use various the concepts in different situations, you will be taking an important step in advancing your career.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
35
LOSKUTNIKOV/SHUTTERSTOCK.COM
36
PART 1 | Introduction to Organizational Behavior
REAL W O R LD R E S PO N S E
MANAGING GROWTH AT GOOGLE
Between 1998 and 2015 Google grew from a two-
more effective at work, including free organic food
person startup to employing over 50,000 people51 in
and snacks, free fitness classes and gyms, and the
more than 40 countries.52 This rapid growth presented
ability to bring pets to work.54 Google regularly sur-
tremendous challenges in integrating new employees
veys employees about their managers, using the infor-
while motivating them to be innovative, productive,
mation to publicly recognize the best ones and give
and loyal to the fast growing company. To maximize
the worst managers intensive coaching and support
employee innovation, trust, and loyalty Google’s
that helps 75 percent of them improve within three
founders researched other organizations that had his-
months.55 Google also hires smart, ambitious people
tories of caring for their people, driving extraordinary
who share the company’s goals and vision and main-
innovation, and building great brands. Visiting with
tains an open culture in which employees feel comfort-
executives at the SAS Institute, frequently ranked as the
able sharing opinions and ideas. In weekly meetings,
best multinational company to work for by the Great
Google employees can even ask questions directly to
Place to Work Institute, reinforced the founders’ belief
executives including founders Page and Brin about
that people thrive in and are loyal to their jobs when
company issues.56 Google’s proactive efforts to be an
they feel fully supported and authentically valued.53
engaging and inspiring place for its employees has
This understanding led to the development of a culture
both helped the company succeed and made it a sta-
anchored by trust, transparency, and inclusion.
ple on various “most desired employer” lists, including
Google is now known for offering its employees a
wide variety of perks the help its employees to be
being named the #1 Best Place to Work honor from
Glassdoor in 2015.57
DISCUSSION QUESTIONS
1. What do you think are the most important things a manager does? Is how
a manager does these things also important? Why or why not?
2. Some people have suggested that understanding human behavior at work
is the single most important requirement for managerial success. Do you
agree or disagree with this statement? Why?
3. The chapter identifies four basic managerial functions. Based on your own
experiences and observations, provide an example of each function.
4. Why will learning about OB help you to get a better job and a better career
,
and be a better manager?
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 1 | An Overview of Organizational Behavior
5.
Some people believe that individuals working in an organization have basic
human rights to satisfaction with their work and to the opportunity to grow and
develop. How would you defend this position? How would you argue against it?
6. Think of something that you believe leads to employee productivity based
on intuition that may not prove to be true if tested systematically . Now
apply the scientific method and describe how you might test your theory.
UNDERSTAND YOURSELF EXERCISE
Global Mindset
This chapter’s Understand Yourself feature gives you the chance to self-assess
your global mindset. Global mindset reflects how well we influence people ,
groups, and organizations from a variety of bac kgrounds and cultures. The
ability to work effectively with people from many parts of the world will help
you to perform well on the job and advance your career faster. After completing the self-assessment, answer the following questions:
1. Do you think that your score accurately reflects your global mindset?
Why or why not? What, if anything, is missing from the assessment?
2. How do you think that having a higher global mindset will help you to
be a better manager and leader? How can this characteristic help you
succeed in your career?
3. What might you do in the next year to increase your global mindset?
Identify and discuss three specific behaviors, activities, or other things
that increase your global mindset.
GROUP EXERCISE
Managing A Successful Restaurant
Form groups of 3–5 students. Imagine that you are all managers in a local restaurant (your group can c hoose the name). There are many restaurants in
town, making it a competitive business. Your food is good, but so is the food at
many other dining options in town. You recognize that providing high quality,
friendly service and having actively engaged employees is going to make the
difference between your restaurant’s success and failure.
Your management team decides to first address organizational citizenship and
employee engagement as drivers of high quality customer service . After all,
employees who are not engaged and who are unwilling to engage in citizenship
behaviors are less likely to contribute to your desired culture of providing great
customer service and a friendly atmosphere. First think independently about what
your restaurant can do to enhance the engagement and citizenship behaviors of
your employees. Then share your ideas with the group and identify your top three
suggestions for the restaurant. Be ready to share your ideas with the class.
Your management team next decides that it will be important to minimize
dysfunctional employee behaviors if the restaurant is to succeed. Behaviors
including theft, harassment, rumor spreading, absenteeism, and high turnover
will hurt the restaurant’s finances, negatively affect morale, and weaken your
team’s ability to provide quality customer service . First think independently
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
37
PART 1 | Introduction to Organizational Behavior
about what your restaurant can do to minimize the occurrence of these destructive behaviors. Then share your ideas with the group and identify your top
three suggestions for the restaurant. Be ready to share them with the class.
VIDEO EXERCISE
Managing at Camp Bow Wow
Camp Bow Wow, a sort of combination day camp/B&B for dogs, was started in
2000 by a dog-loving entrepreneur named Heidi Ganahl. The business is a
franchise, a form of ownership in which a franchiser grants a franchisee the
right to use its brand name and processes and sell its products or services. Sue
Ryan left the corporate world in 2004 take over a Camp Bow Wow franchise in
Boulder, Colorado. To reduce the demands placed on her as the sole manager,
Ryan developed other employees’ managerial skills so that they could be pro moted and share in the managerial responsibilities of the business.
As a class, watch “Camp Bow Wow” (5:57) and then individually consider
the following questions. After you have come up with your own ideas , form
groups of 4–5 people and discuss your insights. Be sure to nominate someone
to serve as a spokesperson to share your ideas with the class.
1.
How does Sue Ryan perform the three basic managerial roles—
i­nterpersonal,
informational, and decision making—in her role at Camp Bow Wow?
2. How do Candace Stathis and Sue Ryan apply the four critical managerial skills—technical, interpersonal, conceptual, and diagnostic—in
their roles at the company? Which of these skills do you think is most
important skill for a manager at Camp Bow Wow and why?
3. How do Ryan and Stathis balance the three levels of business
outcomes—­i ndividual, group and team, and organizational? How
would each manager rank the importance of the three outcomes? Why
are their rankings likely to be the same or different?
VIDEO C A S E
PERCOM/SHUTTERSTOCK.COM
38
Now What?
Imagine being a new manager at Happy Time Toys, a company that designs and
manufactures novelty toys. While attending a group meeting with your boss and
two coworkers, your boss asks for ways of better using the organization’s talent
to create a competitive advantage. What do you say or do? Go to this chapter’s
“Now What?” video, watch the challenge video, and choose the best response. Be
sure to also view the outcomes of the two responses you didn’t choose.
Discussion Questions
1. Which aspects of management and organizational behavior discussed
in this chapter are illustrated in these videos? Explain your answer.
2. How could a company’s talent strategy undermine its ability to create
a competitive advantage?
3. How else might you answer the question of how Happy Time Toys can
create a competitive advantage through its talent?
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 1 | An Overview of Organizational Behavior
39
ENDNOTES
1Our History in Depth. Google.com. Available online: http://
www.google.com/about/company/history/.
16Walmart Says It’s Giving 500,000 U.S. Workers Pay Raises.
2Shontell, A. (2011, May 4). 13 Unusual Ways Sergey Brin
17 Jack Welch s peech t o t he E conomic C lub o f N ew York,
and Larry Page Made Google the Company to Beat. Business Insider. Available online: http://www.businessinsider
.com/history-sergey-brin-larry-page-and-google-strategy2011-3#and-celebrated-tgif-12.
3 For a c lassic discussion of the meaning of organizational
behavior, see Cummings, L. (1978, January). Toward Organizational Behavior. Academy of Management Review , 90–98.
See also Nicholson, N., Audia, P., & Pillutla M. (eds.) (2005).
The Blackwell Encyclopedia of Management: Organizational
Behavior (Vol. 11). London: Blackwell Publishing.
4Lubit, R. (2004, March/April). The Tyranny of Toxic Managers: Applying Emotional Intelligence to Deal with Difficult
Personalities. Ivey Business Journal. Available online: http://
iveybusinessjournal.com/publication/the-tyranny-of-toxicmanagers-an-emotional-intelligence-approach-to-dealingwith-difficult-personalities/
5Javidan, M., Steers, R. M., & Hitt, M. A. (2007). The Global
Mindset, Advances in International Management (Vol. 19).
New York: Elsevier.
6Arora, A., Jaju, A., Kefalas, A. G., & Perenich, T. (2004). An
Exploratory Analysis of Global Managerial Mindsets: A Case
of U.S. Textile and Apparel Industry. Journal of International
Management,10, 393–411.
7Javidan, M., Steers, R. M., & Hitt, M. A. (2007). The Global
Mindset, Advances in International Management (Vol. 19).
New York: Elsevier.
8Story, J. S. P. & Barbuto, J. E. (2011). Global Mindset: A Construct Clarification and F ramework. Journal of Leadership
&Organizational Studies, 18(3), 377–384.
9 Dumaine, B. (1995, August). Don’t Be an Ugly
Manager. Fortune, 225.
American
10 Lane, H. W., Maznevski, M., & Dietz, J. (2009). International Management Behavior: Leading with a Global Mindset
(6th ed.). Sussex, UK: John Wiley & Sons.
11Warren, K. (2009). Developing Employee Talent to Perform,
eds. J. M. Phillips & S. M. Gully. New York: Business Expert
Press.
12Pfeffer, J. (2003). Business and the Spirit: Management Practices That Sustain Values, Handbook of Workplace Spirituality and Organizational Performance, eds. R. A. Giacolone and
C. L. Jurkiewicz (pp. 29–45). New York: M. E. Sharpe Press;
Ulrich, D., & Smallwood, N. (2003). Why the Bottom Line Isn’t!
How to Build Value through People and Organization. New
Jersey: John Wiley & Sons.
Los Angeles Times (2015, February 19)., 9B.
Detroit, May 16, 1994.
18Treacy, M., & Wiersema, F. (1997). The Discipline of Market
Leaders. New York: Perseus Books.
19Lado, A. A., Boyd, N. G., & Wright, P. (1992). A Competency-
Based Model of Sustainable Competitive Advantage: Toward
a Conceptual Integration. Journal of Management, 18, 77–91.
20Worrell, D. (2011). Higher Salaries: Costco’s Secret Weapon,
Allbusiness.com. Available online: http://www.allbusiness.com /
staffing-hr/16745820-1.html.
21Porter, M. E. (1985). Competitive Advantage. New York: Free
Press.
22Porter, M. E. (1985). Competitive Advantage. New York: Free
Press; Porter, M. E. (1998). Competitive Strategy: Techniques for
Analyzing Industries and Competitors. New York: Free Press.
23Beatty, R. W., & Schneier, C. E. (1997). New HR Roles to
Impact Organizational Performance: From “Partners” to “Players.” Human Resource Management, 36, 29–37; Deloitte &
Touche, LLP. (2002). Creating Shareholder Value through
People: The Human Capital ROI Study . New York: Author;
Treacy, M., & Wiersema, F. (1993). Customer Intimacy and
Other Value Disciplines. Harvard Business Review, 71, 84–94.
24Beatty, R. W., & Schneier, C. E. (1997). New HR Roles to
Impact Organizational Performance: From “Partners” to “Players.” Human Resource Management, 36, 29–37; Deloitte &
Touche, LLP. (2002). Creating Shareholder Value through
People: The Human Capital ROI Study . New York: Author;
Treacy, M., & Wiersema, F. (1993). Customer Intimacy and
Other Value Disciplines. Harvard Business Review, 71, 84–94.
25Pieterse, A. N., van Knippenberg, D., Schippers, M., & Stam,D.
(2010). Transformational and Transactional Leadership and
Innovative Behavior: The Moderating Role of Psyc hological Empowerment. Journal of Organizational Behavior , 31,
609–623.
26Groth, M. & Goodwin, R. E. (2011). Customer Service. In
APA Handbook of Industrial and Organizational Psychology:
Maintaining, Expanding, and Contracting the Organization,
ed. S. Zedeck (Vol. 3, pp. 329–357). Washington, DC: American
Psychological Association.
27Beatty, R. W., & Schneier, C. E. (1997). New HR Roles to
Impact Organizational Performance: From “Partners” to “Players.” Human Resource Management, 36, 29–37; Deloitte &
Touche, LLP. (2002). Creating Shareholder Value through
People: The Human Capital ROI Study . New York: Author;
Treacy, M., & Wiersema, F. (1993). Customer Intimacy and
Other Value Disciplines. Harvard Business Review, 71, 84–94.
13The World’s Most Admired Companies, (2015, March 16)
Fortune, 135–140.
28Weber, Y. & Fried, Y. (2011), Guest Editors’ Note: The Role
14Katz, R. L. (1987 September-October). The Skills of an Effective Administrator. Harvard Business Review , 90–102; see
also Hansen, M., Ibarra, H., & Peyer, U. (2010, January-February). The Best-Performing CEOs in the World. Harvard Business Review, 104–113.
29Taylor, F. W. (1911). The Principles of Scientific Management. New York: Harper & Brothers.
15SBC Chief Says Deal Preserves an “Icon.” USA Today (2005,
February 1), 1B, 2B.
30Spender, J. C., & Kijne, H. (1996). Scientific Management:
Frederick Winslow Taylor’s Gift to the World? Boston: Kluwer.
of HR Practices in Managing Culture Clash During the Postmerger Integration Process. Human Resource Management,
50, 565–570.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
40
PART 1 | Introduction to Organizational Behavior
31Mayo, E. (1945). The Social Problems of an Industrial Civili-
zation. Boston: Harvard University Press.
32 Organ, D. W. (2002, March–April). Elusive Phenomena.
Business Horizons, 1–2.
33Deming, W. E. (1986). Out of the Crisis. Boston: Massachu-
setts Institute of Technology.
34Deming, W. E. (1986). Out of the Crisis. Boston: Massachu-
setts Institute of Technology, p. 315.
35Kast, F., & Rosenzweig, J. (1972, December). General Sys-
tems Theory: Applications for Organization and Management.
Academy of Management Journal, 447–465.
36 For a c lassic overview and introduction, see Kast, F., &
Rozenzweig, J. (eds.). (1973). Contingency Views of Organization and Management. Chicago: Science Research Associates.
37Terborg, J. (1981, October). Interactional Psyc hology and
Research on Human Behavior in Organizations. Academy of
Management Review, 569–576; Schneider, B. (1983) Interactional Psychology and Organizational Behavior. In Research in
Organizational Behavior, eds. L. Cummings & B. Staw (Vol. 5,
pp. 1–32). Greenwich, CT: JAI Press; Turban, D. B., & Keon,
T. L. (1993). Organizational Attractiveness: An Interactionist
Perspective. Journal of Applied Psychology, 78(2), 184–193.
38For recent findings regarding this behavior, see Podsakoff, P.
M., MacKenzie, S. B., Paine, J. B., & Bacharah, D. G. G. (2000)
Organizational Citizenship Behaviors: A Critical Review of
the Theoretical and Empirical Literature and Suggestions for
Future Research. Journal of Management, 26(3), 513–563; see
also Organ, D. W., Podsakoff, P. M., & Podsakoff, N. P. (2010).
Expanding the Criterion Domain to Inc lude Organizational
Citizenship Behavior: Implications for Employee Selection.
In Handbook of Industrial and Organizational Psyc hology:
Selecting and Developing Members for the Organization, ed.
S. Zedeck (Vol. 2, pp. 281–323). Washington, DC: American
Psychological Association.
39Griffin, R., & Lopez, Y. (2005) “Bad Behavior” in Organiza-
tion: A Review and Typology for Future Research. Journal of
Management, 31(6), 988–1005.
40For an illustration, see Lim, S., Cortina, L. M., & Magley, V. J.
(2008). Personal and Workgroup Incivility: Impact on Work
and Health Outcomes. Journal of Applied Psychology, 93(1),
95–107.
41See O’Leary-Kelly, A., Griffin, R. W., & Glew, D. J. (1996,
January). Organization-Motivated Aggression: A Research
Framework. Academy of Management Review , 225–253.
See also Douglas, S. C., Kiewitz, C., Martinko, M.J., Harvey,
P., Kim, Y., & Chun, J. U. (2008). Cognitions, Emotions, and
Evaluations: An Elaboration Likelihood Model for Workplace
Aggression. Academy of Management Review, 33(2), 425–451;
and Barclay, L. J., & Aquino, K. (2010). Workplace Aggression
and Violence. In Handbook of Industrial and Organizational
Psychology: Maintaining, Expanding, and Contracting the
Organization, ed. S. Zedeck (Vol. 3, pp. 615–640). Washington,
DC: American Psychological Association.
42 Bacon, F ., Silverthorne , M., & J ardine, L. (2000).
The New Organon. Cambridge, UK: Cambridge University
Press.
43Campbell, J. P. (1990). The Role of Theory in Industrial and
Organizational Psychology. In Handbook of Industrial and
­Organizational Psychology, eds. M. D. Dunnette and L. M. Hough
(Vol. 1, pp. 39–74). Palo Alto, CA: Consulting Psychologists Press.
44Carrig, K., & Wright, P. M. (2007, January). Building Profit
through Building People. Workforce Management. Available
online: http://www.workforce.com/section/09/feature/24/65/90/
index.html.
45Carrig, K., & Wright, P. M. (2007, January). Building Profit
through Building People. Workforce Management. Available
online: http://www.workforce.com/section/09/feature/24/65/90/
index.html.
46Festing, M., Engle, A. D. Sr., Dowling, P. J. & Sahakiants,
I. (2012). Human Resource Management Activities: Pay and
Rewards. In Handbook of Research on Comparative Human
Resource Management , eds. C. Brewster & W. Ma yrhofer
(pp. 139–163). Northampton, MA: Edward Elgar Publishing.
47Forstenlechner, I., & Lettice, F. (2007). Cultural Differences
in Motivating Global Knowledge Workers. Equal Opportunities International, 26(8), 823–833.
48D’Andrade, R. G., & Strauss, C. (1992). Human Motives and
Cultural Models (p. 4). Cambridge, UK: Cambridge University
Press.
49Ayman, R. & Korabik, K. (2010). Leadership: Why Gender
and Culture Matter. American Psychologist, 65, 157–170.
50Lubit, R. (2004, March/April). The Tyranny of Toxic Man-
agers: Applying Emotional Intelligence to Deal with Difficult Personalities. Ivey Business Journal. Available online:
http://www.iveybusinessjournal.com/view_article.asp?
intArticle_ID=475.
51Number of full-time Google Employees from 2007 to 2014.
(2015) Statista. Available online: http://www.statista.com/
statistics/273744/number-of-full-time-google-employees/.
52Google Locations. Google. Available online at: https://www.
google.com/about/company/facts/locations/.
53 Crowley, M. C. (2013, March 21). Not a happy accident:
How Google deliberately designs workplace satisfaction. Fast
Company. Available online: http://www.fastcompany.
com/3007268/where-are-they-now/not-happy-accident-howgoogle-deliberately-designs-workplace-satisfaction.
54D’Onfro, J. & Smith, K. (2014, July 1). Google Employees
Reveal Their Favorite Perks About Working for the Company.
Business Insider. ­Available online: http://www.businessinsider.com/google-employees-favorite-perks-2014-7?op=1.
55Google’s Secrets of Innovation: Empowering Its Employ-
ees. (20 13, M arch 29 ). Forbes. Available on line: h ttp://
www.forbes.com/sites/laurahe/2013/03/29/googles-secretsof-innovation-empowering-its-employees/.
56Our Culture. Google. Available online: http://www.google.
com/about/company/facts/culture/.
57 Glassdoor Employees’ Choice
Award Winners Revealed:
Google #1 Best Place to Work in 2015. (2014, December 9).
Glassdoor.com,. Available online: http://www.glassdoor.com/
blog/glassdoor-employees-choice-award-winners-revealedgoogle-1-place-work-2015/.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
LOSKUTNIKOV/SHUTTERSTOCK.COM
CHAPTER
2
THE CHANGING ENVIRONMENT
OF ORGANIZATIONS
Real World Challenge: Global
Diversity at Coca-Cola
CHAPTER
OUTLINE
DIVERSITY AND BUSINESS
TYPES OF DIVERSITY AND BARRIERS TO
INCLUSION
Types of Diversity
Trends in Diversity
Generational Differences
Diversity Issues for Managers
Case Study: Diversity Issues at
Wegmans
GLOBALIZATION AND BUSINESS
Trends in Globalization
Cultural Competence
Improve Your Skills: Understanding
Your Culture
Global Issues: Cultural Etiquette Quiz
Cross-Cultural Differences and
Similarities
Global Perspective
Understand Yourself: Global
Perspective
After studying this chapter, you should be
able to:
LEARNING
OUTCOMES
1 Describe the nature of diversity in
organizations.
2 Describe the different types of
diversity and barriers to inclusion that
exist in the workplace.
TECHNOLOGY AND BUSINESS
Manufacturing and Service
Technology
Technology and Competition
Information Technology and Social
Media
ETHICS AND CORPORATE
GOVERNANCE
Framing Ethical Issues
Ethical Issues in Corporate
Governance
Ethical Issues and Information
Technology
Social Responsibility
NEW EMPLOYMENT RELATIONSHIPS
The Management of Knowledge
Workers
Outsourcing and Offshoring
Temp and Contingent Workers
Tiered Workforce
The Changing Nature of
Psychological Contracts
4 Discuss the changing nature of
technology and its impact on
business.
5 Describe emerging perspectives on
ethics and corporate governance.
6 Discuss the key issues in new
employment relationships.
3 Discuss the emergence of
globalization and cross-cultural
differences and similarities.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
GLOBAL DIVERSITY AT COCA-COLA
With over 130,000 global employees, over 65,000 of them in in the U.S.,1 beverage
giant The Coca-Cola Company is a global business that operates in a multicultural world
LOSKUTNIKOV/SHUTTERSTOCK.COM
REAL WORLD CHALLENGE
both in the workplace and in the marketplace. The company recognizes that its ability to
thrive in a multicultural world is both critical to its financial performance and consistent with
its values.2 Accordingly, diversity is recognized by Coca-Cola as an important component
of their vision for the company in 2020.3 As The Coca-Cola Company’s CEO Muhtar
Kent said, “The real power of diversity is the incredible synergies that result when different
people and cultures come together united behind a common goal of winning and creating
shared value. Extraordinary things truly happen.”4
The Coca-Cola Company understands that although it has been recognized as a diversity leader there is always more it can do. Imagine that the company’s leaders ask you
for advice on how to build a diverse and inclusive workforce that allows it to leverage the
potential of its diverse employees to enhance the company’s performance. After reading
this chapter, what would you tell them?
ANTONY MCAULAY/SHUTTERSTOCK.COM
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
44
PART 1 | Introduction to Organizational Behavior
The environment of all organizations is c hanging at an unprecedented rate.
People work in different ways and places than in the past, the workplace is
increasingly diverse, ethical challenges are a constant issue, and globalization
is commonplace. Indeed, in some industries , such as consumer electronics ,
popular entertainment, and information technology, the speed and magnitude
of change are truly breathtaking. YouTube, for instance, uploads over 60 hours
of new video footage every hour. And it’s only been during the last decade or
two that smartphone tec hnologies, Facebook, and other forms of social net working have become commonplace.
Even industries characterized by what have been staid and predictable
environments, such as traditional retail and heavy manufacturing, also face
sweeping environmental changes today. Understanding and addressing the
environment of a business has traditionally been the purview of top managers.
But the effects of today’s changing environment permeate the entire organization. Hence, to truly understand the behavior of people in organizational settings, it is also necessary to understand the h
c anging environment of business.5
This chapter is intended to provide the framework for suc h understanding.
Specifically, as illustrated in Figure 2.1, we introduce and examine five of the
Figure 2.1
The changing
environment of
business presents both
opportunities and
challenges for managers
today. Five important
environmental forces are
globalization, diversity,
technology, ethics and
corporate governance,
and new employment
relationships.
The Changing Environment of Business
The Environment
Globalization
Employment
Relationships
Diversity
The Organization
Ethics
and Corporate
Governance
Technology
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations 45
central environmental forces for change faced by today’s organizations: diversity, globalization, technology, ethics and corporate governance , and new
employment relationships. An understanding of these forces will then set the
stage for our in-depth discussion of contemporary organizational behavior.
DIVERSITY AND BUSINESS
Diversity is a major part of the c hanging environment of business. Diversity
refers to the variety of observable and unobservable similarities and differences
among people. Some differences, such as gender, race, and age, are often the first
diversity characteristics to come to mind. But diversity is muc h more than
demographics and can reflect combinations of characteristics rather than a single attribute. Each individual also has a variety of characteristics, and combinations of them can result in diversity. We begin our discussion of diversity by
examining some of the many types of diversity relevant to organizations.
TYPES OF DIVERSITY AND BARRIERS
TO INCLUSION
Types of Diversity
surface-level diversity
Observable differences
in people, including race,
age, ethnicity, physical
abilities, physical
characteristics, and
gender
deep-level diversity
Individual differences
that cannot be seen
directly, including goals,
values, personalities,
decision-making styles,
knowledge, skills,
abilities, and attitudes
IO/
KSTUDK.COM
VGSTOC
RSTOC
E
T
T
U
SH
Have you ever met someone, thought he or she was different from you, and
then learned that the two of you actually had a lot in common? This reflects
two types of diversity: surface-level diversity and deep-level diversity .
­Surface-level diversity refers to observable differences in people, including
race, age, ethnicity, physical abilities, physical characteristics, and gender.
Surface-level diversity reflects characteristics that are observable and known
about people as soon as you see them.
Deep-level diversity refers to individual differences that cannot be seen
directly, including goals, values, personalities, decision-making styles, knowledge, skills, abilities, and attitudes. These “invisible” characteristics in others
take more time to learn about, but can ha ve stronger effects on group and
organizational performance than surface-level c haracteristics.
Even pay differences6 in a group and differences
based on rank or power can affect group pro cesses and performance.7
Two prominent diversity researchers, David
Harrison and Katherine Klein, have identified
diversity
The variety of observable
and unobservable
similarities and
differences among people
Diversity is increasingly common in organizations. Consider, for
instance, all of the surface-level examples of diversity illustrated
in this business meeting. In addition, there are also many forms
of deep-level diversity that cannot even be observed.
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PART 1 | Introduction to Organizational Behavior
TERSTO
CK.COM
The two people working in the top photo reflect several examples of ­surfacelevel diversity while the two individuals in the bottom photo would appear
to be considerably less diverse. Of course, when we take into account deeplevel diversity the two people in the top photo might be more similar than
we think, and the two people in the bottom photo may be more different
than we think.
CK/SHU
TTERST
OCK.CO
M
RACOR
N/SHUT
three other types of within-group diversity that reflect different types of deep-level diversity: 8 Separation diversity
refers to differences in position or opinion among group mem bers reflecting disagreement or opposition—dissimilarity in an
attitude or value, for example, especially with regard to group
goals or processes. Variety diversity exists when there are
meaningful differences in a certain type or category, including
group members’ expertise, knowledge, or functional background.
Finally, disparity ­diversity reflects differences in the concentration of valuable social assets or resources—dissimilarity in rank,
pay, decision-making authority, or status, for instance.
To illustrate these three types of diversity, consider three sixmember teams, each of which is responsible for generating a new
product idea. Team Separation’s diversity is in their attitudes
toward the best approach to use. Half of the team prefers creative
brainstorming while the other half prefers basing the product on
objective, data-based customer analysis. Members of Team Variety
vary in their functional areas of expertise. One is a marketing professional, one a materials specialist, and the others represent manufacturing, product safety, advertising, and law. Lastly, members of
Team Disparity vary in their rank in the organization. One member
of the team is a vice president, two are mid-level managers, and three are
lower-level employees. The diversity in each team is obvious, yet you can imagine how the effects of the diversity will likely differ across each team. Table 2.1
summarizes these five types of diversity.
POTSTO
46
Table 2.1
Five Types of Diversity
1.
2.
3.
4.
5.
Surface-level diversity: observable differences in people, including gender, race,
age, ethnicity, and physical abilities
Deep-level diversity: individual differences that cannot be seen directly, including
goals, values, personalities, decision-making styles, knowledge, and attitudes
Separation: differences in position or opinion among group members reflecting
disagreement or opposition, especially with regard to group goals or processes—
dissimilarity in an attitude or value, for example (a type of deep-level diversity)
Variety: differences in a certain type or category, including group members’
expertise, knowledge, or functional background (a type of deep-level diversity)
Disparity: differences in the concentration of valuable social assets or resources—
including dissimilarity in rank, pay, decision-making authority, or status (a type of
deep-level diversity)
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations 47
Trends in Diversity
As the great U.S. baseball manager Yogi Berra once observed, “It’s tough to
make predictions, especially about the future.” Nonetheless, some short-term
demographic trends are strong enough to suggest that the c hanging demographic mix in the workforce will continue to increase the importance of
understanding and leveraging diversity. For example, the ethnic and cultural
mix of the U.S. workforce is changing in fairly predictable ways. The Census
Bureau projects that by 2020 the U.S. workforce will consist of 62.3 percent
White non-Hispanics, 18.6 percent Hispanics, 12 percent Blacks, and 5.7 percent Asians. Longer-term U.S. demographic projections further highlight the
increasingly diverse character of the United States:9
•
•
•
•
•
•
The population is projected to become older. By 2030, about one in five people will be sixty-five or over (we discuss age diversity in our next section).
By 2050, the total population is forecasted to grow from 282.1 million in 2000
to 419.9 million, a 49 percent increase . (This is in sharp contrast to most
European countries, whose populations are expected to decline by 2050.)
Non-Hispanic Whites are expected to decrease from the current 69.4 percent
of the total population to 50.1 percent by 2050.
People of Hispanic origin (of any race) are projected to increase from
35.6 million in 2002 to 102.6 million in 2050, an increase of 188 percent.
This would nearly double the Hispanic share of the nation’ s population,
from 12.6 percent to 24.4 percent.
The Black population is projected to rise from 35.8 million in 2000 to 61.4
million in 2050, an increase of about 26 million or 71 percent. This would
increase the Black share of the population to 14.6 percent from 12.7 percent.
The Asian population is forecasted to grow 213 percent, from 10.7 million
in 2000 to 33.4 million in 2050. This would double the Asian share of the
population from 3.8 percent to 8 percent.
separation diversity
Differences in position
or opinion among group
members reflecting
disagreement or
opposition—dissimilarity
in an attitude or value, for
example, especially with
regard to group goals or
processes
variety diversity
Differences in a certain
type or category,
including group members’
expertise, knowledge, or
functional background
disparity diversity
Differences in the
concentration of
valuable social assets or
resources—dissimilarity
in rank, pay, decisionmaking authority, or
status, for example
Non-Whites are expected to make up half of the working-age population in
2039 and more than 55 percent in 2050—up from 34 percent toda y. On the
other hand, although the Bureau of Labor Statistics reported as early as 1996
that almost half of all management positions in the United States were held
by White men, diversity remains elusive in the top jobs. In 2014, only 23 of the
Fortune 500 CEOs were minorities, and White people held 87% of total seats
on corporate boards of directors.10
Many countries and regions face talent shortages at all levels , and those
gaps are expected to worsen. By 2040, Europe is forecast to have a shortfall of
24 million workers aged fifteen to sixty-five; raising the proportion of women
in the workplace to that of men would cut the gap to 3 million. In the United
States, the retirement of the baby boomer generation will probably mean the
loss of large numbers of senior -level employees in a short period of time—
nearly one-fifth of the working-age population (sixteen and older) of the
United States will be at least sixty-five by 2016.11
Talent shortages are forecast to rise globally . In the United Kingdom,
male-dominated sectors with a shortage of workers inc lude engineering, IT,
and skilled trades—yet 70 percent of women with science , engineering, or
technology qualifications are not working in these fields.12 Pursuing diversity
can allow firms to attract and retain scarce talent as well as reac h other business goals. One European Commission study showed that 58 percent of
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48
PART 1 | Introduction to Organizational Behavior
AKMED
IA/SHU
TTERST
OCK.CO
M
As the U.S. workforce continues to age, generational
differences in the workplace are becoming increasingly
common. These differences, in turn, pose new challenges and
opportunities for organizations and their managers.
companies w ith d iversity p rograms r eported
higher productivity, improved employee motiva tion, and greater efficiency; and 62 percent said
that the programs helped to attract and retain top
talent. 13 Indeed, today’s war for talent is global,
making recruiting and retaining a diverse workforce
a more competitive business issue than ever.
WAVEB
RE
Generational Differences
As noted above, age-based diversity is a major issue
facing many organizations today. Figure 2.2 provides a
clear indicator of why this is true. Specifically, the U.S.
Bureau of Labor Statistics projects a dramatic increase in workers age sixtyfive and older during the next decade, while the percentage of younger workers
is expected to decrease. This obviously increases the need for succession planning at many organizations to ensure the continuity of leadership . Due to the
aging of the U.S. workforce, and to the clearly differentiated characteristics of
Figure 2.2
The labor force in the
United States is getting
older. For example, as
shown here, between
2006 and 2016 the
number of U.S. workers
between the ages of
65 and 74 grew by
83.4 percent, and the
percentage of workers
75 and older grew by
84.3 percent. In contrast,
the number of workers
between the ages of 25
and 54 grew only by
2.4 percent.
Projected Percentage Change in the U.S. Labor Force by Age from 2006
to 2016
100.00%
84.30%
83.40%
80.00%
60.00%
36.50%
40.00%
20.00%
8.50%
2.40%
0.00%
–20.00%
Total, 16
years and
older
75 and
older
65–74
55–64
–6.90%
25–54
16–24
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations the generations that ­comprise it (discussed next), firms are also paying more
attention to how workers of different ages work together.
For instance, work teams are often age diverse, and it is increasingly likely
that an older employee will report to a younger supervisor. A survey conducted
by the Society for Human Resource Management found that in organizations
with 500 or more employees, 58 percent of HR professionals reported conflict
between younger and older workers, largely due to their different perceptions
of work ethics and work-life balance.14 As Ed Reilly, President of the American
Management Association, says, younger workers “are going to be the eventual
managers. They will be as interested in keeping older workers as older work ers toda y are interested in figuring out how to work with the younger
generations.”15
Most experts characterize today’s workforce as comprising four genera tions. According to date of birth, they are: seniors (1922–1943); baby boomers
(1943–1963); Generation X (1964–1980); and Generation Y, also referred to as
the Millennial Generation (1980–2000). As each generation brings their
unique experiences, values, and worldview, each also brings changes to workplace policies and procedures. For example, many seniors are staying in the
workforce longer than previous generations, leading many firms to revamp
their retirement policies and offer these experienced workers part-time jobs .
Baby boomers’ interest in wellness is changing the fitness programs and wellness benefits many employers provide. Many Generation Xers are concerned
about maintaining balance in their lives, increasing many companies’ interest
in work-life balance programs . Generation Y members are tec hnologically
savvy, the most diverse of any generation, and are considered to be the biggest
workplace influence since the baby boomers.
The U.S. workforce is aging at the same time Generation Y, the largest
generation since the baby boomers, is entering the workforce. This increases
the importance of understanding the role of age in organizations , and how to
manage generational differences at work. Danielle R obinson, Director of
Diversity, Talent, and Organizational Design for global premium drinks com pany Diageo, believes that Generation Y’s entrance into the workplace “has
added a layer of complexity to an already complex work environment.”16
Age tends to be positively related to job performance ,17 although not all
research has supported this relationship.18 The influence of age in training
environments has been extensively studied. Age was negatively associated
with learning scores in an open learning program for managerial skills .19
Older trainees demonstrated lower motivation, reduced learning, and less
post-training confidence in comparison to younger trainees .20 This suggests
that age has a negative relationship with learning, and that part of its influence may be due to motivation. This could be because speed of processing
slows as age increases .21 Such speed is likely to be most important in jobs
requiring high levels of intense , rapid processing of information (e .g., air-­
traffic controllers). It is important to note that this relationship does not hold
for everyone—some older employees are likely to be good learners , and some
younger employees are likely to perform poorly in training.
Increasing conscientiousness and knowledge counteract some of the nega tive effects of aging that result from reductions in information processing
speed and motivation to learn. 22 It is likely that age is related to anxiety and
other emotional variables, particularly in a complex or tec hnologically oriented setting. Older trainees also may have concerns about their ability to
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49
50
PART 1 | Introduction to Organizational Behavior
rapidly process new complex information and as a result, suffer from a variation of the stereotype threat that ethnic minorities sometimes experience .
Consistent with this view, older workers may not participate in learning and
development activities as much as younger workers, in part due to a decline in
confidence in their skills . 23 Beliefs in the adequacy of our skills influence
­decisions to exert and maintain effort, particularly in the face of c hallenges.
Older adults may benefit from self-paced learning environments, which may
allow additional time. Additionally, confidence-boosting interventions can help
to address the negative effects of anxiety and reduced confidence.
Some organizations are using reverse mentoring to bridge generational
differences and transfer the tec hnology skills younger workers bring to the
workplace to more senior employees . Reverse mentoring pairs a senior
employee with a junior employee, but unlike the top-down focus of traditional
mentoring, the focus is on transferring the skills of the junior employee to the
senior employee.24
Reverse mentoring was made popular by former GE CEO Jack Welch, who
realized that the web w as going to transform business and knew that GE’ s
younger, “webified” employees had better Internet skills and e-business knowledge than did GE’s older and higher-ranking executives. He decided to pair an
Internet savvy employee with one of GE’s 600 worldwide executives to share
their expertise about the new technology. In addition to building the e-­business
capabilities of his managers, this unique “mentoring up” program made managers at all levels more comfortable with eac h other, and transferred a lot of
technology knowledge throughout GE.25
Diversity Issues for Managers
Why should we care about diversity? Because as employees , the better we are
able to work with all types of people, the more effective we will be in our jobs. As
managers, diversity awareness will enable us to hire, retain, and engage the best
talent, which will help to maximize the organization’s performance. Diversity also
fosters greater creativity and innova THE DIV
tion.26 Indeed, a strong business case
ERSITY
1. Nova
INC TO
can be made for diversity.
P 20 L
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4. EY
Coopers
5. Sodex
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The Business Case for Diversity
One reason that organizations
should promote diversity is performance. Recent research has found
that firm performance increases
when employees have more positive
attitudes toward diversity.27 Diversity
contributes to a firm’s competitive
advantage when it enables all
employees to contribute their full talents and motivation to the company.
TOP 50
r Perman
IST
11. Well
ITYINC
cals
DIVERS
2. Kaise
rmaceuti
D FROM
tion
ications
ADAPTE
Corpora
Organizations should pursue diversity for many
reasons. One very practical reason is that inclusion
and diversity can often lead to improved business
performance. Each of the firms on this list, for instance,
has performed very well over the last several years.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations The primary motivation for effectively managing diversity is the fact that
doing so brings out the best in all employees, allowing each of them to contribute maximally to the firm’s performance in an increasingly competitive business environment.
Some people even argue that diversity can be a source of competitive advantage for organizations.28 For example, some studies have found that culturally
diverse work teams make better decisions over time than do homogeneous
teams.29 Diverse groups can use their diverse bac kgrounds to develop a more
comprehensive view of a problem and a broader list of possible solutions. The
broader social network of diverse employees also can give workgroups and organizations access to a wider variety of information and expertise. Further, diversity can be a source of creativity and innovation that can create a competitive
advantage.30 A review of decades of research found that diversity can enhance
creativity and improve a team’s decision making.31 Research by noted management expert Rosabeth Moss Kanter found that innovative companies intentionally use heterogeneous teams to solve problems and do a better job of eliminating
racism, sexism, and classism.32 Having more women in top management positively affects the performance of firms pursuing an innovation strategy.33
Diversity management is also important for legal reasons. Although many
other antidiscrimination laws exist, one of the most important is Title VII of
the Civil Rights Act of 1964, amended in 1991. It prohibits employment dis crimination based on race, color, religion, sex, or national origin. Title VII prohibits not only intentional discrimination but also practices that have the effect
of discriminating against individuals because of their race, color, national origin, religion, or sex. Other laws offer protections to additional groups, including
employees with disabilities34 and workers over the age of forty.35
The Civil Rights Act of 1991 allows monetary damages in cases of inten tional employment discrimination. One of the largest employment discrimination lawsuits was settled for more than $11.7 million against Walmart and
Sam’s Club.36 Thousands of female employees filed a c lass-action suit over
alleged denial of advancement, equal pay, promotions, and raises based on the
fact that they were women. 37 Obeying the law and promoting diversity is consistent with hiring the people best suited for the job and organization.
Barriers to Inclusion
Given both the performance benefits and legal imperatives of diversity, then,
what prevents companies from becoming inc lusive and making the most of
their diversity? A report of the U.S. Equal Employment Opportunity Commission identified several common diversity barriers that exist in many organizations. 38 These barriers, summarized in Table 2.2, stem from a variety of
decision-making and psychological factors as well as from employee unawareness. Understanding and proactively addressing the barriers can minimize
their impact and enhance inclusion:
1. The “Like Me” Bias: Consciously or unconsciously, we tend to associate
with others whom we perceive to be like ourselves . This bias is part of
human nature. Although it can create a higher comfort level in working
relationships, the “like me” bias can also lead to a tendency to employ and
work with people like ourselves in terms of protected c haracteristics such
as race, color, sex, disability, and age; and it can result in an unwilling ness to employ people unlike ourselves. Perceived cultural and religious
differences and ethnocentrism can feed on the “like me” bias and restrict
inclusion. Because the “like me” bias can influence the assessment of
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51
52
PART 1 | Introduction to Organizational Behavior
Table 2.2
Barriers to Inclusion
The “like me” bias
People prefer to associate with others they perceive to be like
themselves.
Stereotypes
A belief about an individual or a group based on the idea that
everyone in a particular group will behave the same way or
have the same characteristics.
Prejudice
Outright bigotry or intolerance for other groups.
Perceived threat
of loss
If some employees perceive a direct threat to their own career
opportunities, they may feel that they need to protect their own
prospects by impeding diversity efforts.
Ethnocentrism
The belief that one’s own language, native country, and cultural
rules and norms are superior to all others.
Unequal access
to organizational
networks
Women and minorities are often excluded from organizational
networks, which can be important to job performance, mentoring
opportunities, and being seen as a candidate for promotion.
performance norms, there may be a perception that someone “different” is
less able to do a job and that someone “like me” is better able to do a job.
2. Stereotypes: A stereotype is a belief about an individual or a group based o n
the idea that everyone in that particular group will beha ve the same way.
For example, “all men are strong,” “all women are nurturing,” and “people
who look a c ertain way are dangerous” are all examp les of stereotypes.
A male research scientist who tends to believe that women make poor
­scientists is unlikely to hire, mentor, or seek the opinion of a female scientist. Stereotypes can reduce inclusion opportunities for minorities, women,
persons with disabilities, and both younger and older workers . Stereotypes are harmful because they result in judgments about an individual
based solely on his or her being part of a particular group , regardless of
his or her unique identity. People may have stereotypes of other individuals based on their race , color, religion, national origin, sex, disability, or
age, among other things. Stereotypes are often negative and erroneous,
and thus adversely affect the targeted individuals.39 Because stereotypes
can breed subtle racism, sexism, prejudice, and discomfort, they must be
addressed in the diversity context. Recruiters and hiring managers ma y
have stereotypes of what makes good or poor employees that can adversely
affect equal employment opportunities and undermine diversity efforts.
3. Prejudice: It is also possible that outright bigotry still occurs on the part
of an employer or its management for or against a targeted group , despite
Title VII now having been in existence for more than forty years. 40 Even
if an organization has a strong commitment to inc lusion, it is possible
that the beliefs and actions of individual employees or managers are
­inconsistent with the organization’s policies and values. Organizations
can help to reduce the occurrence of prejudice by carefully selecting and
training managers and employees, evaluating their inclusion behaviors,
and tracking the promotion rates of members of different groups who work
for different supervisors to identify possible discriminatory trends that
­warrant further attention.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations 4. Perceived Threat of Loss: As voluntary efforts are made by companies to
promote inclusion, members of groups who traditionally ha ve been the
predominant employees of a particular workforce or occupation ma y grow
anxious or angry. If they perceive a direct threat to their own career opportunities, they may feel that they need to protect t heir own prospects by
impeding the prospects of others.41 This can influence employees’ willingness to help minority employees, recruit diverse candidates for a position,
and support diversity initiatives.
5. Ethnocentrism: Ethnocentrism reflects the belief that one’s own language,
native country, and cultural rules and norms are superior to all others.
Ethnocentrism often has less to do with prejudice and more to do with
inexperience or ignorance about other people and environments. Because
people know more about the cultural and behavioral norms of their home
country, they have a better understanding of people from that country.
Education and experiences that promote greater cross-cultural awareness
can foster a conscious effort to value and promote cultural diversity.
6. Unequal Access to Organizational Networks: All organizations have formal
and informal networks. These organizational networks influence knowledge sharing, resource accessibility, and work opportunities. Women and
minorities are often excluded from informal organizational networks,
which can be important to job performance, mentoring opportunities, and
being seen as a candidate for promotion. 42 Research has associated male
domination at the upper ranks of a firm with female executives’ reports of
barriers to advancement and exclusion from informal networks.43
Managing Diversity
In addition to awareness of the barriers to inclusion discussed above, there are
also other proactive things managers can do to promote diversity . The most
important element in effectively leveraging the positive potential of diversity is
top management support for diversity and for diversity initiatives. If top managers do not promote inclusion and respect diversity, lower-level managers and
employees are not likely to do so either. In addition, an inclusive environment
is created when all employees’ cultural awareness and empathy are enhanced
through diversity training and all employees are given equal access to mentors
and other influential company employees. Creating fair company policies and
practices that give all employees equal access to performance feedback, training and development, and advancement opportunities is also critical.
Diversity is more likely to positively affect companies that support diverse
employees in higher-level positions and help all employees effectively interact
with people who are different from them. Diversity initiatives are more successful when the company is able to keep employees thinking about diversity issues,
even when they do not feel a direct, negative impact.44 This chapter’s Case Study
highlights what grocer Wegmans does to effectively manage diversity.
Training and mentoring can also help . Reciprocal mentoring , whic h
matches senior employees with diverse junior employees to allow both individuals to learn more about a different group, is one technique used to promote
diversity awareness and inclusion. Some organizations use career development
programs, networking opportunities, and mentoring programs for all employees to promote diversity.45 Diversity training and diversity education need to
communicate that bias is a part of being human. It is not realistic to claim or to
pursue an “I’m totally unbiased” stance with regard to diversity. Everyone has
biases whether or not they are aware of them—diversity training should enable
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
53
PART 1 | Introduction to Organizational Behavior
Diversity At Wegmans
East coast grocer Wegmans views diversity as
more than just a legal or moral obligation or business necessity—to them it is a business opportunity. 46 Diversity is part of Wegmans everyday
culture and viewed as something that enables
them to being the very best at serving the needs of
all customers. The company strives to attract and
retain a workforce that reflects different backgrounds, experiences, and viewpoints and mirrors
the communities in which it operates.47
Wegmans believes that to be a great place to
shop, they must first be a great place to work. Wegmans looks to hire people who love food and who
have a natural propensity to serve and good skills
working with the public. Wegmans emphasizes
diversity in hiring to refresh stores with new ideas.
The workforce includes people from a wide variety
of backgrounds, from high school students to retired
professionals. Corporate values including respect,
caring, empowerment, and high standards have
helped the company repeatedly appear on Fortune’s
list of the 100 Best Companies to Work For.48
Questions:
1. In what ways can diverse employees contribute to Wegmans’ business performance?
2. What types of diversity do you think Wegmans should focus on? Why?
3. What are the downsides, if any, of building a
diverse workforce?
PHANT/SHUTTERSTOCK.COM
CASE STUDY
employees to become aware of them and learn to control them to prevent both
explicit and implicit displays of bias.
GLOBALIZATION AND BUSINESS
globalization
The internationalization of
business activities and the
shift toward an integrated
global economy
Another, and some w ays related, environmental factor that affects OB is
­globalization. Of course, in many ways, globalization and international management are not new. Centuries ago, the Roman army was forced to develop a
management system to deal with its widespread empire.49 Moreover, many notable early explorers such as Christopher Columbus and Magellan were not actu ally seeking new territory but instead were looking for new trade routes to boost
international trade. Likewise, the Olympic Games , the Red Cross , and other
organizations have international roots. From a business standpoint, however, the widespread effects of globalization are relatively new, at least in the United States.
BRENT
GETTY LEWIN/BLOO
MBERG
IMAGES
/
LOSKUTNIKOV/SHUTTERSTOCK.COM
54
Trends in Globalization
In 2014, the volume of international trade in current
dollars was about 50 times greater than the amount
Globalization is a major part of the changing environment of
business. Fast food businesses like KFC and McDonald’s, for
example, have set up shop around the world. Their challenge is
to maintain the identify and appeal that led them to become so
recognizable while also adapting to customer tastes and workplace
practices in different countries.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations in 1960. Indeed, while international trade actually dec lined by 11 percent in
2009 due to the global recession, it increased by that same amount in 2010 as the
economy began a slow rebound and has remained on an upward trajectory ever
since. Four major factors account for much of the growth in international trade.
First, communication and transportation have improved dramatically over
the past several decades. Telephone service has improved, communication networks span the globe and can interact via satellite, and once-remote areas have
become routinely accessible. Telephone service in some developing countries is
now almost entirely by cellular phone technology rather than land-based wired
telephone service. Fax and email technologies allow managers to send docu ments around the world in seconds as opposed to the days it took just a few
years ago. And new applications such as text messaging and digital conferencing
have made global communication even easier. In short, it is simply easier to
conduct international business today than was the case just a few years ago.
Second, businesses have expanded internationally to increase their markets. Companies in smaller countries, such as Nestlé in Switzerland and
Heineken in the Netherlands, recognized long ago that their domestic markets
were too small to sustain much growth and therefore moved into the interna tional arena. Many U.S. firms, on the other hand, have only found it advantageous to enter foreign markets in the last half-century . Now, though, most
midsize and even many small firms routinely buy and/or sell products and
services in other countries.
Third, more and more firms are moving into international markets to con trol costs, especially to reduce labor costs. Pursuing the lowest possible labor
costs has raised ethical questions, however, and strategies to cut costs in this
way do not always work out as planned. This is in part because the process has
sometimes drawn criticism due to media and consumer activist concern about
the labor standards employed in other countries. Nonetheless, many firms are
successfully using inexpensive labor in Asia and Mexico. 50 In searching for
lower labor costs, some companies have discovered well-trained workers and
built more efficient plants that are c loser to international markets. India, for
instance, has emerged as a major force in the high-tec h sector. Turkey and
Indonesia are also growing in importance. And many foreign automakers have
built plants in the United States. Finally, many organizations have become
international in response to competition. If an organization starts gaining
strength in international markets, its competitors often must follow suit to
avoid falling too far behind in sales and profitability. U.S. oil
companies like Exxon Mobil Corporation and
Chevron re alized th ey h ad t o inc rease the ir
international market share to keep pace with
foreign competitors such as BP and Royal Dutch
Shell. Although labor cost control is often cited as
a primary reason for offshoring, many organizations are increasingly offshoring innovation proj ects not for labor arbitrage but merely to access
/
SGROUP
LIMAGE
IVERSA
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GETTY
One major reason that businesses move into international
markets is to take advantage of lower labor costs. For instance,
many firms moved production facilities to Mexico several years
ago because of low labor costs. China then became a magnet
for business with its own low labor costs. But as wages have
started in climb there some businesses are looking at other
manufacturing locations such as Vietnam.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
55
56
PART 1 | Introduction to Organizational Behavior
the qualified talent missing at home or that they are ha ving difficulty acquiring due to increased competition from other employers.
Cultural Competence
cultural competence
The ability to interact
effectively with people of
different cultures
Italians often perceive people from the United States as people who are always
working, talking about business over lunc h and drinking their coffee while
running in the street instead of enjoying those activities with others. Does this
mean that Italians are lazy and Americans are hyperactive? No, it means that
people from different cultures give different meanings to some activities. In
Italy, where relationships are highly valued, lunch, dinner, and pauses for coffee have a social purpose—people get together to relax and to get to know each
other better. In the United States, where time is money, business can be part
of lunch, deals are discussed during dinner , and contracts are signed over
coffee.51
One of the worst, yet easiest, mistakes people can make is to assume that
other people are just like them. People from different cultures see and do
things in different ways. Cultural competence is the ability to interact effectively with people of different cultures. A culturally competent person has a
respectful awareness and understanding of cultural differences . There are
four components of cultural competence:52
1. Awareness of our own cultural worldview, and of our reactions to people
who are different–A security guard who knows that she profiles teenagers
as “troublemakers” is culturally aware of her reactions to this group.
2. Our attitude toward cultural differences –This reflects a willingness to
honestly understand our beliefs and values about cultural differences.
3. Knowledge of different worldviews and cultural practices –Research has
found that our values and beliefs about equality may be inconsistent with our
behaviors. Many people whose answers on a test indicated they did not have
prejudices did things in cross-cultural situations that reflected prejudice.53
4. Cross-cultural skills–This component addresses the importance of practicing cultural competence, including nonverbal communication, to become
effective cross-culturally.
Although some people are naturally culturally competent, most of us
have to put effort into developing this skill. This requires honestly examining our prejudices and biases, actively developing cross-cultural skills, learning from role models, and having a positive attitude about cultural issues .
The key to cross-cultural success is awareness—being aware of how culture
influences your interpretations of others, your own behavior, and how people
from other cultures may see you. Understanding why we do things in certain
ways, how we see the world, and why we react as we do is an important part
of being culturally aware. Cultural awareness can improve performance in
culturally diverse organizations, or when a firm’s customers are diverse. This
chapter’s Improve Your Skills feature will help you understand some of the
characteristics of your own culture that are likely to differ in other areas of
the world.
Just for fun, take the Cultural Etiquette Quiz in this c hapter’s Global
Issues feature and see how much you know about working and doing business
in other cultures.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
57
IMPROVE YOUR SKILLS
UNDERSTANDING YOUR CULTURE
As you have learned in this chapter, cultural competence
requires an awareness of your own cultural practices and
worldview. This worksheet will help you to analyse some of
the features of your own societal culture. For each cultural
Cultural Feature
feature, identify an example that represents most of the
people in your primary culture. Then take a minute to
reflect on how other cultures might differ, and how these
differences might lead to misunderstanding.
Example of Feature
Representing Your
Primary Culture
How Feature Might
Differ and Cause
Misunderstanding in
Other Cultures
1. Social greetings
2. Attitudes toward privacy
3. Appropriate decision-making speed
4. Openness of communication
5. Gestures that reflect that you understand
what you have just been told
6. Personal grooming
7. Deference to authority figures
8. Acceptable personal space
9. Timeliness
10. Work ethic
Cross-Cultural Differences and Similarities
The primary concern of this book is human beha vior in organizational set tings, so we now turn our attention to differences and similarities in beha vior
across cultures. While there is relatively little research in this area, interesting findings have begun to emerge.54
General Observations
At one level, it is possible to make several general observations about similarities and differences across cultures. For one thing, cultural and national
boundaries do not necessarily coincide . Some areas of Switzerland are very
much like Italy, other parts like France, and still other parts like Germany.
Similarly, within the United States there are large cultural differences across,
say, Southern California, Texas, and the East Coast.55
Given this basic assumption, one major review of the literature on inter national management reached five basic conclusions.56 First, behavior in organizational settings does indeed vary across cultures . Thus, employees in
companies based in Japan, the United States, and Germany are likely to have
different attitudes and patterns of beha vior. The behavior patterns are also
likely to be widespread and pervasive within an organization.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
ILDOGESTO/SHUTTERSTOCK.COM
CHAPTER 2 | The Changing Environment of Organizations PART 1 | Introduction to Organizational Behavior
GLOBAL
ISSUES
CULTURAL ETIQUETTE QUIZ
Successfully managing or conducting business across cultures
involves knowing what to say, when to arrive for meetings,
what to wear, what gifts are acceptable, and what greeting
to give, among many other things. It takes a continued effort
to recognize and appreciate the other party’s expectations
and business practices. This quiz will give you an idea of
how aware you are of the business cultures of other areas of
the world. Answers are at the bottom of the quiz.57
_______________ 1.Which culture often views professional titles as arrogant?
_______________ 2.Where should you not use red ink
on your business card because
the color red has a negative
connotation?
_______________ 3.
In this culture, it may be considered an insult to leave immediately
following a meeting, as this may
suggest that you are not interested
in getting to know the other party.
_______________ 4.If you compliment someone in this
country on one of their personal
items, they may insist that you
accept it as a gift.
_______________ 5.In this country, tapping your nose
signals that something is to be kept
secret or confidential.
_______________ 6.In this country, beckoning someone
with your palm up while wagging
one finger can be taken as an
insult.
_______________ 7.
In what country do people who
have worked together for years
still shake hands every morning
as if they were meeting for the first
time?
BALDYRGAN/SHUTTERSTOCK.COM
58
_______________ 8.In this country, negotiations usually
take a long time and are chaotic,
with numerous people often speaking simultaneously.
_______________ 9.The “thumbs up” gesture is offensive in this country.
_______________ 10.Be sensitive to the volume of your
voice in this country. Loud voices
are known to be offensive in meetings as well as in restaurants and
on the street.
_______________ 11.
Negotiations and meetings with
people from this country often
involve flared tempers, and tantrums and walkouts often occur.
Standing with your hands in your
pockets is also considered rude in
this culture.
_______________ 12.Because saving face is so important in this culture, you will often
hear “It’s inconvenient” or “I’ll look
into it” instead of being told “No.”
Answers: (1) Ireland; (2) Madagascar; (3) Colombia; (4) Bahrain; (5) England; (6) India (and China); (7) Germany; (8) Spain; (9) Saudi Arabia;
(10) France; (11) Russia; (12) China
culture
The set of shared values,
often taken for granted,
that help people in a
group, organization, or
society understand which
actions are considered
acceptable and which
are deemed unacceptable
Second, culture itself is one major cause of this variation. Culture is the
set of shared values, often taken for granted, that help people in a group, organization, or society understand which actions are considered acceptable and
which are deemed unacceptable. Thus, although the behavioral differences
just noted may be caused in part by different standards of living, different geographical conditions, and so forth, culture itself is a major factor apart from
other considerations.
Third, although the causes and consequences of beha vior within
­organizational settings remain quite diverse across cultures, organizations and
the ways they are structured appear to be growing increasingly similar .
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations 59
Hence, managerial practices at a general level may be becoming more and more
alike, but the people who work within organizations still differ markedly.
Fourth, the same individual behaves differently in different cultural settings. A manager may adopt one set of behaviors when working in one culture
but change those behaviors when moved to a different culture . For example,
Japanese executives who come to work in the United States ma y slowly begin
to act more like U.S. managers and less like Japanese managers. This, in turn,
may be source of concern for them when they are transferred back to Japan.
Finally, cultural diversity can be an important source of synergy in enhancing organizational effectiveness. More and more organizations are coming to
appreciate the virtues of diversity, but they still know surprisingly little about
how to manage it. Organizations that adopt a multinational strategy can—
with effort—become more than a sum of their parts. Operations in each culture can benefit from operations in other cultures through an enhanced
understanding of how the world works.58
Specific Cultural Issues
Geert Hofstede, a Dutch researcher, studied workers and managers in 60 coun tries and found that specific attitudes and behaviors differed significantly because
of the values and beliefs that characterized those countries.59 Table 2.3 shows how
Hofstede’s categories help us summarize differences for several countries.
The two primary dimensions that Hofstede found are the individualism/
collectivism continuum and power distance. Individualism exists to the
extent that people in a culture define themselves primarily as individuals
rather than as part of one or more groups or organizations . At work, people
from more individualistic cultures tend to be more concerned about
individualism
Exists to the extent that
people in a culture define
themselves primarily as
individuals rather than
as part of one or more
groups or organizations
Table 2.3
Work-Related Differences in 10 Countries
Country
Individualism/
Collectivism
Power
Distance
Uncertainty
Avoidance
Masculinity
Long-Term
Orientation
CANADA
H
M
M
M
L
GERMANY
M
M
M
M
M
ISRAEL
M
L
M
M
(no data)
ITALY
H
M
M
H
(no data)
JAPAN
M
M
H
H
H
MEXICO
H
H
H
M
(no data)
PAKISTAN
L
M
M
M
L
SWEDEN
H
M
L
L
M
UNITED STATES
H
M
M
M
L
VENEZUELA
L
H
M
H
(no data)
Note: H = high; M = moderate; L = low for INDIVIDUALISM/COLLECTIVISM. H means High Individualism, L means High Collectivism and M means
a balance of individualism and collectivism. These are only 10 of the more than 60 countries that Hofstede and others have studied.
References: Adapted from Geert Hofstede and Michael Harris Bond, “The Confucius Connection: From Cultural Roots to Economic Growth,”
Organizational Dynamics, Spring 1988, pp. 5–21; Geert Hofstede, “Motivation, Leadership, and Organization: Do American Theories Apply
Abroad?” Organizational Dynamics, Summer 1980, pp. 42–63.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
60
PART 1 | Introduction to Organizational Behavior
collectivism
Characterized by tight
social frameworks in
which people tend to
base their identities on
the group or organization
to which they belong
power distance (also
orientation to authority)
The extent to which
people accept as normal
an unequal distribution of
power
uncertainty avoidance
(also preference for
stability)
The extent to which
people feel threatened by
unknown situations and
prefer to be in clear and
unambiguous situations
masculinity (also
assertiveness or
materialism)
The extent to which
the dominant values in
a society emphasize
aggressiveness and the
acquisition of money
and other possessions
as opposed to concern
for people, relationships
among people, and
overall quality of life
TOSHIF
AFP/GE UMI KITAMU
R
TTY IM
AGES A/
long-term values
Include focusing on
the future, working
on projects that have
a distant payoff,
persistence, and thrift
themselves as individuals than about their work group , individual tasks are
more important than relationships , and hiring and promotion are usually
based on skills and rules. Collectivism, on the other hand, is characterized by
tight social frameworks in whic h people tend to base their identities on the
group or organi zation to wh ich they b elong. At work , this means that
employee–employer links are more like family relationships, relationships are
more important than individuals or tasks, and hiring and promotion are based
on group membership. In the United States, a very individualistic culture, it is
important to perform better than others and to stand out from the crowd. In
Japan, a more collectivistic culture, an individual tries to fit in with the group,
strives for harmony, and prefers stability.
Power distance, which might also be called orientation to authority, is
the extent to which people accept as normal an unequal distribution of power. In
countries such as Mexico and Venezuela, for example, people prefer to be in a
situation in which authority is clearly understood and lines of authority are
never bypassed. On the other hand, in countries such as Israel and Denmark,
authority is not as highly respected and employees are quite comfortable circumventing lines of authority to accomplish something. People in the United States
tend to be mixed, accepting authority in some situations but not in others.
Hofstede a lso identified ot her di mensions of c ulture. Uncertainty
­avoidance, which might also be called preference for stability, is the extent
to which people feel threatened by unknown situations and prefer to be in
clear and unambiguous situations. People in Japan and Mexico prefer stability
to uncertainty, whereas uncertainty is normal and accepted in Sweden, Hong
Kong, and the United Kingdom. Masculinity, which might be more accurately
called assertiveness or materialism, is the extent to which the dominant
values in a society emphasize aggressiveness and the acquisition of money
and other possessions as opposed to concern for people, relationships among
people, and overall quality of life. People in the United States tend to be moderate on both the uncertainty avoidance and masculinity scales. Japan and
Italy score high on the masculinity scale while Sweden scores low.
Hofstede’s framework has recently been expanded to inc lude long-term
versus short-term orientation. Long-term values include focusing on the
future, working on projects that have a distant payoff, persistence, and thrift.
Short-term values are more oriented toward the past and the present and
include respect for traditions and social obligations . Japan, Hong Kong, and
China are highly long-term oriented.The Netherlands, the United States,
and G ermany a re m oderately l ong-term o riented.
Pakistan and West Africa tend to be more shortterm oriented.
Hofstede’s research presents only one of sev eral ways of categorizing differences across many
different countries and cultures. His findings, however, are now widely accepted and have been used
by many companies . They ha ve also prompted
Collectivism tends to be a dominant cultural value in many Asian
countries. As a result, workers such as these have a tight social
framework and closely identify with their co-workers.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations ongoing research by others. The GLOBE project, one major extension of Hofstede’s work specifically related to leadership , is discussed in Chapter 12. The
important issue to remember at this point is that people from diverse cultures
value things differently from each other and that people need to take these differences into account as they work.
61
short-term values
More oriented toward
the past and the present
and include respect for
traditions and social
obligations
Global Perspective
A global perspective is distinguished by a willingness to be open to and learn
from the alternative systems and meanings of other people and cultures, and a
capacity to avoid assuming that people everywhere are t he same.60 A person
with a global perspective scans the world from a broad view , always seeking
unexpected trends and opportunities. People with global perspectives are more
likely to see a broad context and accept life as a balance of conflicting forces .
They are not threatened by surprises or uncertainties, and value diversity.61
They are also able to na vigate through unfamiliar cultures with an open and
external focus.62 Given globalization trends and the multicultural nature of the
U.S. workforce, managers increasingly need a global perspective and a supportive set of skills and knowledge to be most effective.63 To meet this need, business
schools are increasing their efforts to develop students’ global managerial
skills.64 This chapter’s Understand Yourself feature gives you the opportunity to
assess your own global perspective and better understand how to enhance it.
global perspective
A willingness to be
open to and learn from
the alternative systems
and meanings of other
people and cultures,
and a capacity to avoid
assuming that people
from everywhere are the
same
TECHNOLOGY AND BUSINESS
Technology also represents a major environmental issue that affects busi nesses today. Technology refers to the methods used to create products ,
including both physical goods and intangible services . Technological change
has become a major driver for other forms of organization change. Moreover, it
also has widespread effects on the behaviors of people inside an organization.
Three specific areas of technology worth noting here are: (1) the shift toward a
service-based economy, (2) the growing use of technology for competitive
advantage, and (3) mushrooming change in information technology.65
technology
Refers to the methods
used to create products,
including both physical
goods and intangible
services
Manufacturing and Service Technologies
Manufacturing is a form of business that combines and transforms resources
into tangible outcomes that are then sold to others . The Goodyear Tire and
Rubber Company is a manufacturer because it combines rubber and c hemical
compounds and uses blending equipment and molding mac hines to create
tires. Broyhill is a manufacturer because it buys wood and metal components,
pads, and fabric and then combines them into furniture. And Apple is a manufacturer because it uses electronic, metal, plastic, and composite components
to build smartphones, computers, and other digital products.
Manufacturing was once the dominant technology in the United States.
During the 1970s, manufacturing entered a long period of decline, primarily
because of foreign competition. U.S. firms had grown lax and sluggish, and new
foreign competitors came onto the scene with better equipment and muc h
manufacturing
A form of business that
combines and transforms
resources into tangible
outcomes that are then
sold to others
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62
U N D E R S TA N D Y O U R S E L F
GLOBAL PERSPECTIVE
This self-assessment gives you the opportunity to better
understand your global perspective. Place your response
on the line to the left of each statement using the scale
below, and then follow the scoring instructions and read
the interpretation at the end.
slightly
strongly
disagree disagree disagree
1
2
3
neutral
slightly
agree
agree
strongly
agree
4
5
6
7
Conceptualization
___ 1. I think it is necessary today to develop strategic
alliances with organizations around the globe.
___ 2. Projects that involve international dealings are
long-term.
___ 3. I believe that in the next ten years the world will
be the same as it is today.
___ 4. In this interlinked world of ours, national boundaries are meaningless.
___ 5. We really live in a global village.
___ 6. In discussions, I always drive for a bigger,
broader picture.
___ 7. I believe life is a balance of contradictory forces
that are to be appreciated, pondered, and
managed.
___ 8. I find it easy to rethink boundaries and to change
direction and behavior.
___ 9. I feel comfortable with change, surprise, and
ambiguity.
___ 10. I believe I can live a fulfilling life in another
culture.
Contextualization
___ 11. I enjoy trying food from other countries.
___ 12. I enjoy working on world community projects.
___ 13. I mostly care about the local news.
___ 14. I am at my best when I travel to worlds that I do
not understand.
___ 15. I get very curious when I meet somebody from
another country.
___ 16. I enjoy reading foreign books or watching
­foreign movies.
___ 17. I have a lot of empathy for people who struggle
to speak my own language.
___ 18. When something unexpected happens, it is easier to change the process than the structure.
___ 19. In trying to accomplish my objectives, I find that diversity and multicultural teams play a valuable role.
___ 20. I have close friends from other cultural
backgrounds.
TUULIJUMALA/SHUTTERSTOCK.COM
PART 1 | Introduction to Organizational Behavior
Scoring: The sum of your scores for statements 1 to 10 is
your Conceptualization score: _____. Plot your score on
the following continuum:
10 20 30 40 50 60 70
The sum of your scores for statements 11 to 20 is your
Contextualization score: _____. Plot your score on the following continuum:
10 20 30 40 50 60 70
Interpretation: The higher your Conceptualization
score, the better you are able to think globally. The higher
your Contextualization score, the better you are able to
act locally and adapt to the local environment. Global perspective is characterized by high levels of both conceptualization and contextualization. Training in international
management, living in a foreign country, and working in
a foreign country are all related to having higher global
perspective.66 Although both thinking globally and acting locally are important to managers, most managers
are more adept at thinking globally than at acting locally
because of the uniqueness of local cultures.
If you are interested in enhancing your global perspective, reflect on the statements above that you rated lower
than others and identify ways of improving in those areas.
Joining international organizations and seeking out multicultural experiences can enhance your global perspective.
Source: Adapted from Arora, A., Jaju, A., Kefalas, A.G., & Perenich, T.
(2004). An Exploratory Analysis of Global Managerial Mindsets: A Case
of U.S. Textile and Apparel Industry. Journal of International Management,
10, 393–411. Copyright © 2004 Elsevier Inc. All rights reserved.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations Service organizations create time or place utility for customers.
Restaurants and snack bars, for example, provide convenient
dining options for people too busy to cook at home or who
just want to eat out.
/SHUTT
AVONE
SEAN P
K.COM
ERSTOC
higher levels of efficiency. For example, steel companies in the Far East were able to produce high-­quality
steel for much lower prices than large U.S. steel companies like such as Bethlehem Steel and U .S. Steel.
Faced with a battle for survival, some companies disappeared, but many others underwent a long and diffi cult period of c hange by eliminating w aste and
transforming themselves into leaner and more efficient
and responsive entities. They reduced their workforces
dramatically, closed antiquated or unnecessary plants,
and modernized their remaining plants. Over the last
decade or so, their efforts have started to pay dividends
as U.S. manufacturing has regained a competitive position in many different industries . While low wages continue to center a great deal of global manufacturing in Asia,
some manufacturers are now thriving in the United States.
During the decline of the manufacturing sector, a tremendous growth in the
service sector kept the overall U .S. economy from dec lining at the same rate .
A service organization is one that transforms resources into an intangible
­output and creates time or place utility for its customers . For example, Merrill
Lynch makes stock transactions for its customers, Uber provides real-time transportation for passengers, and your local hairdresser cuts your hair. In 1947, the
service sector was responsible for less than half of the U.S. gross national product
(GNP). By 1975, however, this figure reached 65 percent, and by 2006 had surpassed 75 percent. The service sector has been responsible for almost 90 percent
of all new jobs created in the United States since 1990. Moreover, employment in
service occupations is expected to grow 20.9 percent between 2012 and 2022.67
Managers have come to see that many of the tools, techniques, and methods that are used in a factory are also useful to a service firm. For example,
managers of automobile plants and hair salons eac h have to decide how to
design their facility, identify the best location for it, determine optimal capacity, make decisions about inventory storage, set procedures for purchasing raw
materials, and set standards for productivity and quality. At the same time,
though, service-based firms must hire and train employees based on a different skill set than is required by most manufacturers. For instance, consumers
seldom come into contact with the Toyota employee who installs the seats in
their car, so that person can be hired based on tec hnical skills. But Avis must
recruit people who not only have the technical skills for managing car rentals
but who can also effectively interface with a variety of consumers.
service organization
One that transforms
resources into an
intangible output and
creates time or place
utility for its customers
Technology and Competition
Technology is the basis of competition for some firms, especially those whose
goals include being the technology leaders in their industries. A company, for
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PART 1 | Introduction to Organizational Behavior
example, might focus its efforts on being the lowest-cost producer or on
always having the most tec hnologically advanced products on the market.
But because of the rapid pace of new developments , keeping a leadership
position based on technology is becoming increasingly challenging. Another
challenge is meeting constant demands to decrease cycle time (the time that
it takes a firm to accomplish some recurring activity or function from beginning to end).
Businesses have increasingly found that they can be more competitive if
they can systematically decrease cyc le times. Many companies, therefore,
now focus on decreasing cycle times in areas ranging from developing prod ucts to making deliveries and collecting credit pa yments. Twenty years ago,
it took a carmaker about five years from the decision to launch a new product until it w as available in dealer showrooms . Now most companies can
complete the cycle in less than two years. The speedier process allows them
to more quickly respond to changing economic conditions, consumer preferences, and new competitor products while recouping their product- ­
development costs faster. Some firms compete directly on how quickly they
can get things done for consumers. In the early days of personal computers,
for instance, getting a made-to-order system took six to eight weeks . Today,
firms such as Dell can usually ship exactly what the customer w ants in a
matter of days.
Information Technology
Most people are very familiar with the swift advances in information tec hnology. Cellular telephones and electronic datebooks have been replaced by smart
phones, while use of e-books and digital cameras has been enhanced by the
invention of tablets. These devices, and the technologically based social networking sites like Facebook and Twitter, are just a few of the many recent
innovations that have changed how people live and work. 68 Breakthroughs in
information technology have resulted in leaner organizations, more flexible
operations, increased collaboration among employees, more flexible work sites,
and improved management processes and systems. On the other hand, they
have also resulted in less personal communication, less “down time” for managers and employees, and an increased sense of urgency vis-à-vis decision
making and communication—changes that have not necessarily always been
beneficial. We discuss information technology and its relationship to OB more
fully in Chapter 9.
ETHICS AND CORPORATE GOVERNANCE
ethics
A person’s beliefs
regarding what is right or
wrong in a given situation
Ethics and related issues ha ve also engendered renewed interest in recent
years. While ethics have long been of relevance to businesses, what seems like
an epidemic of ethical breaches in recent years has placed ethics in the main stream of managerial thought today. One special aspect of business ethics, corporate governance, has also taken on increased importance . Ethics also
increasingly relate to information technology. Before discussing these issues,
however, it is useful to understand how best to frame ethical relationships in
organizations.
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CHAPTER 2 | The Changing Environment of Organizations 65
Framing Ethical Issues
Figure 2.3 illustrates how many ethical situations can be framed. Specifically,
most ethical dilemmas faced by managers relate to how the organization
treats its employees, how employees treat the organization, and how employees and organizations treat other economic agents.
How an Organization Treats Its Employees
One important area of managerial ethics is the treatment of employees by the
organization. This area includes policies such as hiring and firing, wages and
working conditions, and employee privacy and respect. For example, both ethical and legal guidelines suggest that hiring and firing decisions should be
based solely on an individual’s ability to perform the job. A manager who discriminates against African Americans in hiring is exhibiting both unethical
and illegal behavior. But consider the case of a manager who does not discriminate in general but who hires a family friend when other applicants might be
just as—or perhaps more—qualified. Although these hiring decisions may not
be illegal, they may be objectionable on ethical grounds.
Figure 2.3
• Conflicts of interest
• Secrecy and
confidentiality
• Honesty
Employees
Organization
• Hiring and firing
• Wages and working
conditions
• Privacy and respect
Subject to Ethical Ambiguities
• Advertising and promotions
• Financial disclosure
• Ordering and purchasing
• Shipping and solicitations
• Bargaining and negotiation
• Other business relationships
Economic Agents
• Customers
• Competitors
• Stockholders
• Suppliers
• Dealers
• Unions
Managers face a variety
of ethical situations.
In most cases these
situations involve how
the organization treats
its employees, how
employees treat the
organization, and
how employees and
organizations treat other
economic agents.
From GRIFFIN, Management, 11E. © 2013 Cengage Learning
Managerial Ethics
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PART 1 | Introduction to Organizational Behavior
D/SHUT
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One important perspective in framing ethical issues is how the
organization treats its employees. Take this closed business, for
example. If its employees showed up for work one day and found
this sign on the door, more people would agree that the business
owners did not treat their employees ethically or responsibly by
not giving them more advance notice of the impending closure.
STEVE
BYLAN
Wages and working conditions, although tightly
regulated, are also areas for potential controversy.
For example, a manager paying an employee less
than he deserves , simply because the manager
knows the employee cannot afford to quit or risk los ing his job by complaining , might be considered
unethical. The same goes for employee benefits, especially if an organization takes action that affects the
compensation packages—and w
­ elfare—of an entire
workforce or segment of it. Finally, most observers
would also agree that an organization is obligated to protect the privacy of its
employees. A manager’s divulging to employees that one of their coworkers is
having financial problems or an affair with another employee is generally seen
as an unethical breach of privacy. Likewise, the manner in which an organization addresses issues associated with sexual harassment involves employee privacy and related rights. When organizations begin to conduct business in other
countries, the lack of clear requirements in the treatment of employees in both
countries and whether or not the home country’s human resources practices and
standards should be ­globally applied or locally determined often presents ethical challenges for managers.
IMAGES
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How Employees Treat the Organization
Numerous ethical issues also stem from how
employees treat the organization, especially in
regard to conflicts of interest, secrecy and confidentiality, and honesty. A conflict of interest occurs
when a decision potentially benefits the individual
to the possible detriment of the organization. To
guard against such practices, most companies ha ve
policies that forbid their buyers to accept gifts from
suppliers. Divulging company secrets is also clearly
unethical. Employees who work for businesses in
highly competitive industries—­electronics, software,
and fashion apparel, for example—might be tempted
to sell information about company plans to competi tors. A third area of concern is honesty in general.
­Relatively common problems in this area include such
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66
Another perspective in framing ethical issues is how employees treat the
organization. If this employee is taking envelopes for business reasons
that is, of course, ethical and appropriate. But if the envelopes are for
personal use then most people would see this as unethical.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations activities as using a ­business telephone to make personal calls, stealing supplies, and padding expense accounts.
In recent years, new issues regarding such behaviors as personal Internet
use at work have also become more pervasive. Another disturbing trend is
that more workers are calling in sick simply to get extra time off. One survey,
for instance, found that the number of workers who reported taking more time
off for personal needs w as increasing substantially. A more recent CareerBuilder survey found that 29 percent of workers surveyed admitted to having
called in sick when they were actually well. 69 Yet another survey found that
two-thirds of U.S. workers who call in sick do so for reasons other than illness.
Although most employees are basically honest, organizations must nevertheless be vigilant to avoid problems resulting from such behaviors.
How Employees and the Organization Treat Other
Economic Agents
Managerial ethics also come into play in the relationship between the firm
and its employees with other economic agents. As shown above in Figure 2.3,
the primary agents of interest include customers, competitors, stockholders,
suppliers, dealers, and unions. The interactions between the organization and
these agents that may be subject to ethical ambiguity include advertising and
promotions, financial disclosures, ordering and purchasing, shipping and solicitations, bargaining and negotiation, and other business relationships.
For example, state pharmacy boards are charged with overseeing prescription drug safety in the United States. All told, there are almost 300 pharmacists
who serve on such boards. It was recently reported that 72 of these pharmacists
were employees of major drugstore chains and supermarket pharmacies. These
arrangements, while legal, could create the potential for conflicts of interest,
because they might give the pharmacist’s employers influence over the regulatory system designed to monitor their own business practices.70
Another area of concern in recent years involves financial reporting by some
e-commerce firms. Because of the complexities inherent in valuing the assets
and revenues of these firms, some of them have been very aggressive in presenting their financial positions in highly positive lights. In at least a few cases, some
firms have substantially overstated their earnings projections to entice more
investment. After Time-Warner merged with AOL, it discovered that its new
online partner had overstated its value through various inappropriate accounting methods. Some of today’s accounting scandals in traditional firms have
stemmed from similarly questionable practices.71 For instance, Diamond Foods,
maker of Emerald snack nuts and Pop Secret popcorn, recently had to restate its
earnings after an audit uncovered several accounting irregularities.72
Hilton Hotels hired two senior executives a way from rival Starwood
Hotels. It was later determined that the executives took eight boxes of electronic and paper documents with them; much of the material in the boxes
related to plans and details for starting a new luxury-hotel brand. When
­H ilton announced plans to start suc h a c hain itself, to be called Denizen
Hotels, officials at Starwood became suspicious and investigated. When they
learned about the theft of confidential materials, which Hilton subsequently
returned, Starwood filed a lawsuit against Hilton.73
Additional complexities faced by many firms today include the variations in
ethical business practices in different countries. In some countries, bribes and
side payments are a normal and customary part of doing business . However,
U.S. laws forbid these practices, even if a firm’s rivals from other countries are
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PART 1 | Introduction to Organizational Behavior
paying them. For example, a U.S. power-generating company once lost a
$320 million contract in the Middle East because government officials demanded
a $3 million bribe. A Japanese firm paid the bribe and won the contract.Another
major American company once had a big project in India cancelled because
newly elected officials demanded bribes. And Walmart has been charged with
paying $24 million in bribes to Mexican officials to sidestep local regulations
and obtain expedited building permits for new stores .74 Although such payments are illegal under U.S. law, other situations are more ambiguous. In China,
for example, local journalists expect their cab fare to be paid if they are covering
a business-sponsored news conference. In Indonesia, the normal time for a foreigner to get a driver’s license is over a year, but it can be “expedited” for an
extra $100. In Romania, building inspectors routinely expect a “tip” for a favorable review.75 And the government of Bahrain charged Alcoa with involvement
in a 15-year conspiracy involving overcharging, fraud, and bribery.76 Alcoa, for
instance, billed Bahraini clients for “overhead,” a normal and understood charge
in some countries but not in parts of the Middle East.Similarly, gifts provided to
some local officials by Alcoa were seen by other officials as bribes.
Ethical Issues in Corporate Governance
corporate governance
Refers to the oversight of
a public corporation by
its board of directors
A related area of emerging concern relates to ethical issues in corporate
­governance—the oversight of a public corporation by its board of directors.
The board of a public corporation is expected to ensure that the business is
being properly managed and that the decisions made by its senior manage ment are in the best interests of shareholders and other stakeholders. But in
far too many cases the recent ethical scandals alluded to previously have actually started with a br eakdown in th e corporate governance structure. For
instance, in a now-classic ethical scandal involving governance issues, WorldCom’s board approved a personal loan to the firm’s CEO, Bernard Ebbers, for
$366 million even though there w as little evidence that he could repa y it.
Likewise, Tyco’s board approved a $20 million bonus for one of its own mem bers for helping with the acquisition of a firm owned by that individual (this
bonus was in addition to the purchase price!).
Boards of directors are also increasingly being criticized even when they
are not directly implicated in wrongdoing . The biggest complaint here often
relates to board independence. Disney, for instance, has faced this problem in
the past. Several key members of the firm’s board of directors were from companies that do business with Disney, and others were long-time friends of
senior Disney executives. While board members need to have some familiarity
with both the firm and its industry in order to function effectively, they also
need to have sufficient independence to carry out their oversight function.77
Ethical Issues and Information Technology
Another set of issues that have emerged in recent times involves information
technology. Among the specific questions in this area are individual rights to
privacy and the potential abuse of information tec hnology by companies .
Indeed, online privacy has become a hot issue as companies sort out the
related ethical and management issues. DoubleClick, an online advertising
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations network, is one of the firms at the center of the privacy debate . The company
has collected data on the habits of millions of web surfers, recording which
sites they visit and which ads they click on. DoubleClick insists that the profiles are anonymous and are used to better matc h surfers with appropriate
ads. However, after the company announced a plan to add names and addresses
to its database, it was forced to bac k down because of public concerns over
invasion of online privacy.
DoubleClick isn’t the only firm gathering personal data about people’s
Internet activities. People who register at Yahoo! are asked to list date of birth,
among other details. Amazon, eBay, and other sites also ask for personal information. And GPS and other tracking technologies allow firms to potentially
know where their subscribers are physically located at any point in time. Disney now uses wrist bands for guests entering its theme parks. These bands are
efficient for visitors, as they are used for park admissions, purchases, access to
their hotel rooms, bypassing long wait lines for rides, and so forth. At the same
time, though, the bands allow Disney to track visitor locations and use facial
recognition software to connect photographs with visitors . As awareness of
these capabilities increases, surveys show that people are troubled by the
amount of information being collected, who gets to see it, and other issues
associated with privacy.
One way management can address these concerns is by posting a privacy
policy on its website. The policy should explain exactly what data the company
collects and who gets to see the data. It should also allow people a choice about
having their information shared with others and indicate how people can opt
out of data collection. Disney, IBM, and other companies support this position
by refusing to advertise on websites that have no posted privacy policies.
In addition, companies can offer web surfers the opportunity to review and
correct information that has been collected, especially medical and financial
data. In the offline world, consumers are legally allowed to inspect credit and
medical records. In the online world, this kind of access can be costly and cumbersome, because data are often spread across several computer systems .
Despite the technical difficulties, government agencies are already working on
Internet privacy guidelines; this means, in turn, that companies will also need
internal guidelines, training, and leadership to ensure compliance.
Social Responsibility
A related business challenge relevant to OB is adopting a broader stakeholder
perspective and looking beyond shareholder value or the short-term stoc k
price. In general, this view is called social responsibility.78 Definitions of corporate social responsibility often inc lude businesses living and working
together for the common good and valuing human dignity. An important part
of this is how employers treat their employees. When the social responsibility
issues involve the creation of a “green” strategy intended to protect the natural environment it is often called corporate sustainability. Organizations are
increasingly interested in balancing their financial performance with their
employees’ quality of life, and improving the local community and broader
society. One expert defined corporate social responsibility this way: “Regardless of how many people with whom you come in contact, every one of them
should be better off for having known you and your company.”79
social responsibility
Businesses living and
working together for
the common good and
valuing human dignity
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PART 1 | Introduction to Organizational Behavior
Corporate social responsibility has become increasingly
important in recent years. Some firms actively engage in
social responsibility by promoting fitness activities such as
fun runs, bicycle races, and so forth.
OENDL
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Is it really the responsibility of businesses to
be good citizens? Doing so can help a firm attract
the best talent, and customers are increasingly
favoring companies that do the right thing. Ethical
behavior and socially responsible business prac tices have been extensively discussed and have
been accepted as significant aspects of management
practice. Although most agree with their importance
in principle, some people still believe that managers
should focus solely on stockholders’ interests. Others
argue that because business is an influential element
of society, it has an obligation to solve problems of
public concern, that it is in the enlightened self-interest of organizations to be socially responsible. In other
words, social responsibility supporters believe that ethical beha vior is more
profitable and more rational than unethical behavior, and crucial for the effectiveness of business organizations.
To have lasting effects, social responsibility efforts should be integrated
into the culture of the organization. 80 Corporate social responsibility has the
biggest impact when it is integrated with business priorities , relevant to
achieving business objectives, inclusive of both internal and external stake holder needs, and consistent with the firm’s cultural values and brand iden tity.81 Serving stockholders as well as the larger population of stakeholders ,
which includes workers, customers, the community, and even the planet, are
not mutually exclusive.
Corporate sustainability initiatives can be top-down, with someone in a
position of authority dictating to managers and employees what to do . Corporate sustainability efforts can also be grassroots, with employees identifying
projects and taking the initiative to organize their own activities . Indeed,
employee participation in social responsibility initiatives not only can moti vate employees, but also can generate some good ideas. When a major printing
company set a goal to reduce its waste by 20 percent over five years, its executive team naturally focused on finding ways to streamline its printing operations to reduce paper waste. After a series of brainstorms, a receptionist
pointed out that the number of individual lunches delivered to the office every
day created a significant amount of food pac kaging waste. By investing in a
small café and encouraging employees to eat a buffet-style lunc h, the printer
reduced twice as much waste as it di d by stre amlining its printing operations.82 Google calculates that it takes over 2,000 cars off the road every da y
through its free electric car charging stations, its electric car-sharing program
for employees, and its employee shuttle . 83 Nearly 50 percent of Walmart
employees signed up for the company’s personal sustainability project, which
encourages employees to live more sustainable lives by educating them on
ways to conserve resources and reduce energy consumption at home.84
The International Organization for Standardization (ISO) has created a
variety of standards that help organizations gain international acceptance of
PATRIC
KP
70
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations their practices and outcomes.85 In addition to environmentally related stan dards such as sustainability and carbon emissions, the ISO publishes management standards including those for leadership, customer focus, involvement of
people, and continual improvement. These standards can help managers meet
their environmental and social responsibility objectives.
NEW EMPLOYMENT RELATIONSHIPS
A final significant area of environmental change that is particularly relevant for businesses today involves what we call new employment relation ships. While we discuss employment relationships from numerous
perspectives in Part 2 of this book, two particularly important areas today
involve the management of knowledge workers and the outsourcing of jobs
to other businesses, especially when those businesses are in other coun tries. Managing temporary and contingency workers and tiered workforces
is also becoming increasingly complex. The nature of psyc hological contracts is also changing.
The Management of Knowledge Workers
Traditionally, employees added value to organizations because of what they
did or because of their experience. However, during today’s “information age,”
many employees add value simply because of what they know.86 These employees are often referred to as knowledge workers. How well these employees
are managed is seen as a major factor in determining whic h firms will be successful in the future.87 Knowledge workers include computer scientists, physical scientists, engineers, product designers, and video game developers. They
tend to work in high-technology firms and are usually experts in some abstract
knowledge base. They often believe they have the right to work in an autonomous fashion, and they identify more strongly with their profession than with
any organization—even to the extent of defining performance primarily in
terms recognized by other members of their profession.88
As the importance of information-driven jobs grows , the need for knowledge workers will grow as well. However, these employees require extensive
and highly specialized training , and not everyone is willing to make the
human capital investments necessary to move into these jobs . In fact, even
after knowledge workers are on the job , retraining and training updates are
critical so that their skills do not become obsolete . It has been suggested, for
example, that the “half-life” for a technical education in engineering is about
three years. Further, the failure to update the required skills will not only
result in the organization’s losing competitive advantage but will also increase
the likelihood that the knowledge worker will go to another firm that is more
committed to updating those skills.89
Compensation and related policies for knowledge workers must also be
specially tailored. For example, in many high-tech organizations, engineers
and scientists have the option of entering a technical career path that parallels a management career path. This allows the knowledge worker to continue
to carry out specialized work without taking on large management
knowledge workers
Those employees
who add value in an
organization simply
because of what they
know
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PART 1 | Introduction to Organizational Behavior
DAVID
PEARSO
N/ALAM
Y
Outsourcing and offshoring have become increasingly
commonplace--and often controversial. These call-center
workers in India, for example, are providing support services
for a U.S. company. But some critics charge that such
practices reduce jobs in the United States.
outsourcing
The practice of hiring
other firms to do work
previously performed by
the organization itself;
when this work is moved
overseas, it is often called
offshoring
offshoring
Outsourcing to workers in
another country
responsibilities, while at the same time offering
that worker compensation that is equivalent to
that available to management. In other high-tech
firms, the emphasis is on pay for performance, with
profit sharing based on projects or products devel oped by the knowledge workers. In addition, in most
firms employing these workers there has been a tendency to reduce the number of levels of the organization to allow the knowledge workers to react more
quickly to the external environment by reducing the
need for bureaucratic approvals.90
Outsourcing and Offshoring
Outsourcing is the practice of hiring other firms to do work previously per formed by the organization itself. It is an increasingly popular strategy because
it helps firms focus on their core activities and avoid getting sidetracked by secondary activities. The snack bar at a large commercial bank may be important
to employees and some customers, but running it is not the bank’s main line of
business and expertise. Bankers need to focus on money management and
financial services, not food-service operations. That’s why most banks outsource
snack bar operations to food-service management companies whose main line of
business includes cafeterias. The result, ideally, is more attention to banking by
bankers, better food service for snack bar customers, and formation of a new
supplier–client relationship (food-service ­company/bank). Firms today often
outsource numerous activities, including payroll, employee training, facility
maintenance, and research and development.
Up to a point, at least, outsourcing makes good business sense in areas
that are highly unrelated to a firm’ s core business activities. However, what
has attracted considerably more attention in recent years is the growing trend
toward outsourcing abroad in order to lower labor costs; this practice is often
called offshoring. One recent estimate suggests that 3.3 million white-collar
jobs performed in the United States in 2005 ha ve been moved abroad; this
same study suggests that 1 out of 10 IT jobs once held by U.S. workers are now
handled by non-U.S. workers.91
Many software firms, for example, have found that there is an abundance
of talented programmers in India who are willing to work for much lower salaries than their American counterparts. Likewise, many firms that operate
large call centers find that they can handle those operations for muc h lower
costs from other parts of the world. As a result, domestic jobs are lost. Some
firms have attracted additional criticism when they require their domestic
workers—soon to be out of jobs—to train their newly hired foreign replace ments! Clearly, there are numerous beha vioral and motivational issues
involved in practices such as these.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations 73
Temp and Contingency Workers
Another trend that has impacted employment relationships in business
involves the use of contingent or temporary workers. Indeed, recent years have
seen an explosion in the use of such workers by organizations. A contingent
worker is a person who works for an organization on something other than a
permanent or full-time basis. Categories of contingent workers include independent contractors, on-call workers, temporary employees (usually hired
through outside agencies), and contract and leased employees. Another category is part-time workers. The financial services giant Citigroup, for example,
makes extensive use of part-time sales agents to pursue new c lients. About
10 percent of the U.S. workforce currently has one of these alternative forms of
employment relationships. Moreover, almost 80 percent of U.S. employers use
some form of nontraditional staffing arrangement. Most employers find these
kinds of arrangements to be less expensive than adding permanent staff. They
also provide greater flexibility. Some employees, though, take such jobs only
because they can’t find a traditional job. Others value the flexibility they often
accompanies a nontraditional job.
Managing contingent workers is not always straightforward, however,
especially from a behavioral perspective. Expecting too much from such workers, for example, is a mistake that managers should avoid. An organization
with a large contingent workforce must make some decisions about the treatment of contingent workers relative to the treatment of permanent, full-time
workers. Should contingent workers be invited to the company holida y party?
Should they have the same access to such employee benefits as counseling services and childcare? There are no right or wrong answers to suc h questions.
Managers must understand that they need to develop a strategy for integrat ing contingent workers according to some sound logic and then follow that
strategy consistently over time.92
contingent worker
A person who works
for an organization on
something other than a
permanent or full-time
basis
Tiered Workforce
Yet another emerging issue in new employment relationships is what we call
the tiered workforce. A tiered workforce exists when one group of an organization’s workforce has a contractual arrangement with the organization objectively different from that of another group performing the same jobs. For
example, during the 2008–2010 recession Harley-Davidson negotiated a new
agreement with its labor union for wages and job security at its large motorcycle factory in York, Pennsylvania. The change was needed to help the plant
remain competitive and to prevent Harley from moving York jobs to other factories. Under terms of the agreement, the wage for the lowest-paid production
worker on staff at the time of the agreement w as set as $24.10 an hour. All
new employees hired for that same job in the future, however, would earn
$19.28 an hour. Yet another group of employees, called “casual” workers, work
on an “as needed” basis and would be paid $16.75 an hour.93 Similarly, under
contracts negotiated with the United Auto Workers during the recession, new
hires at Ford, General Motors, and Chrysler earn a lower hourly w age and
reduced benefits compared to workers already on the payroll when the agreement was signed.94 General Motors, for example, pays its pre-contract employees a minimum of $28 an hour, but all new employees start at $14 an hour .
tiered workforce
When one group of an
organization’s workforce
has a contractual
arrangement with the
organization objectively
different from another
group performing the
same jobs
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PART 1 | Introduction to Organizational Behavior
These and similar arrangements, of course, may pose new challenges in the
future. For instance, recently hired workers ma y come to feel resentment
towards their more senior colleagues who are getting paid more for the same
work. Likewise, as the job market improves and workers ha ve more options,
firms may face higher turnover among their newer lower-paid employees.
The Changing Nature of Psychological Contracts
psychological contract
A person’s set of
expectations regarding
what he or she will
contribute to an
organization and what
the organization, in
return, will provide to the
individual
A final element of the business environment that both affects and is affected
by employment relationships suc h as those discussed above is the
­psychological contract. Whenever we buy a car or sell a house , both buyer
and seller sign a contract that specifies the terms of the agreement—who pays
what to whom, when it’s paid, and so forth. A psychological contract resembles
a standard legal contract in some w ays, but it is less formal and less well
defined. Specifically, a psychological contract is a person’s overall set of expectations regarding what he or she will contribute to the organization and what
the organization will provide in return. 95 Unlike any other kind of business
contract, a psychological contract is not written on paper , nor are all of its
terms explicitly negotiated.
Figure 2.4 illustrates the essential nature of a psyc hological contract. The
individual makes a variety of contributions to the organization—such things
as effort, skills, ability, time, and loyalty. Jill Henderson, a branch manager for
Merrill Lynch, uses her knowledge of financial markets and investment opportunities to help her clients make profitable investments. Her MBA in finance,
coupled with hard work and motivation, have allowed her to become one of the
firm’s most promising young managers. The firm believed she had these attributes when it hired her, of course, and expected that she would do well.
In return for these contributions, the organization provides inducements
to the individual. Some inducements, such as pay and career opportunities,
are tangible rewards. Others, such as job security and status, are more intangible. Jill Henderson started at Merrill Lynch at a very competitive salary and
has received an attractive salary increase each of the six years she has been
with the firm. She has also been promoted twice and expects another
­promotion—perhaps to a larger office—in the near future.
Figure 2.4
Psychological
contracts govern the
basic relationship
between people and
organizations. Individuals
contribute such things as
effort and loyalty. In turn,
organizations offer such
inducements as pay and
job security.
The Psychological Contract
Contributions from
the Individual
Effort
Ability
Loyalty
Skills
Time
Competencies
Inducements from
the Organization
Pay
Job Security
Benefits
Career Opportunities
Status
Promotion Opportunities
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations In this instance, both Jill Henderson and Merrill L ynch apparently perceive that the psychological contract is fair and equitable. Both will be satisfied with the relationship and will do what they can to maintain it. Henderson
is likely to continue to work hard and effectively, and Merrill Lynch is likely to
continue to increase her salary and give her promotions. In other situations,
however, things might not work out as well. If either party sees an inequity in
the contract, that party may initiate a change. The employee might ask for a
pay raise or promotion, put forth less effort, or look for a better job elsewhere.
The organization can also initiate change by training the worker to improve
his skills, by transferring him to another job, or by firing him.
All organizations face the basic challenge of managing psychological contracts. They want value from their employees, and they need to give employees
the right inducements. For instance, underpaid employees may perform poorly
or leave for better jobs elsewhere. An employee may even occasionally start to
steal organizational resources as a way to balance the psychological contract.
Overpaying employees who contribute little to the organization,though, incurs
unnecessary costs.
Recent trends in downsizing and cutbacks have complicated the process of
managing psychological contracts, especially during the recession of 2008–2010.
For example, many organizations used to offer at least reasonable assurances of
job permanence as a fundamental inducement to employees. Now, however, job
permanence is less likely, so alternative inducements may be needed. 96 Among
the new forms of inducements that some companies are providing are additional
training opportunities and increased flexibility in working schedules.
Increased globalization of business also complicates the management of
psychological contracts. For example, the array of inducements that employees
deem to be of value varies across cultures. U.S. workers tend to value individual
rewards and recognition, but Japanese workers are more likely to value groupbased rewards and recognition. Workers in Mexico and Germany highly value
leisure time and may thus prefer more time off from work, whereas workers in
China may place a lower premium on time off . The Lionel Train Company,
maker of toy electric trains, once moved its operations to Mexico to capitalize on
cheaper labor. The firm encountered problems, however, when it could not hire
enough motivated employees to maintain quality standards and ended up making a costly move back to the United States. That is, the prevailing low wages in
Mexico (which prompted the firm to move there to begin with) were not suffi cient inducement to motivate the high quality performance the firm expected.
A related problem faced by international businesses is
the management of psychological contracts
for expatriate managers. In some ways, this
process is more like a formal contract than are
other employment relationships. Managers
selected for a foreign assignment, for
instance, are usually given some estimate of
EE.EU/
GRAPH
PHOTOERSTOCK.COM
SHUTT
A psychological contract is an unwritten agreement
about expectations between an organization and its
employees. This manager and employee, for example,
are finalizing an understanding about how a new project
will be managed. The agreement is not written, but both
sides understand what they are supposed to do and what
they can expect in return.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
75
76
PART 1 | Introduction to Organizational Behavior
the duration of the assignment and receive various adjustments in their compensation package, including cost-of-living adjustments, education subsidies
for children, reimbursement of personal travel expenses, and so forth. When
the assignment is over, the manager must then be integrated bac k into the
domestic organization. During the time of the assignment, however, the organization itself may have changed in many ways—new managers, new coworkers, new procedures, new business practices , and so forth. Thus, returning
managers may very well come back to an organization that is quite different
from the one they left and to a job quite different from what they expected.97
SUMMARY AND APPLICATION
Diversity is much more than demographics and can reflect combinations of
characteristics in addition to a single attribute. Each individual also has a
variety of characteristics that can be considered diverse. There are many types
of diversity, including surface-level and deep-level diversity. Diversity can be
examined as a group characteristic, as in “this group is diverse with regard to
gender, race, and experience,” or as an individual characteristic in terms of a
person’s similarity to or difference from the other group members . Having a
token minority member in a group affects the majority members’ perceptions
of that minority group , placing greater performance pressures on minority
group members, increasing stereotyping , and creating more boundaries
between majority and minority group members.
Diversity affects individual and organizational outcomes through processes including social integration, differences in status and power, task conflict, relationship conflict, inclusion, and information processing. Barriers to
inclusion include the “like me” bias, stereotypes, prejudice, perceptions of loss
by persons who feel threatened by diversity initiatives , ethnocentrism, and
unequal access to organizational networks. Organizations promote diversity
through top management commitment, staffing, training, and mentoring.
Societal culture reflects language , politics, religion, and values among
other things, and societal culture can vary within a single country or across
nearby countries. Because societal culture influences the diverse values, customs, language, and expectations we bring with us to work, it is important to
understand its effects on our own as well as on other people’ s behaviors. Societal cultures can differ on a variety of characteristics, including collectivism,
power distance, future orientation, and gender egalitarianism as well as determine what employees consider desirable leadership c haracteristics. You will
be a more effective performer and leader if you are culturally aware.
Globalization is playing a major role in the environment of many firms
today. The volume of international trade has grown significantly and continues to grow at a very rapid pace. There are four basic reasons for this growth:
(1) communication and transportation have advanced dramatically over the
past several decades; (2) businesses have expanded internationally to increase
their markets; (3) firms are moving into international markets to control costs,
especially to reduce labor costs; and (4) many organizations have become
international in response to competition. There are numerous cross-cultural
differences and similarities that affect behavior within organizations.
Technology refers to the methods used to create products , including both
physical goods and intangible services . Technological change has become a
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77
REA L W O R LD R E S PO N S E
GLOBAL DIVERSITY AT COCA-COLA
Diversity is taken seriously at all levels in The Coca-
The company has created a movement where
Cola Company. Senior executives including the
its global business leaders see the benefits of and
Chairman and CEO are involved with many non-
take responsibility for creating a diverse and inclu-
profits involving underrepresented groups, and cor-
sive working environment. Rather than just focusing
porate goals are linked to individuals’ diversity
on diversity numbers, The Coca-Cola Company
metrics including being a cross-cultural mentor and
focuses on fostering an inclusive culture using
the recruitment, promotion, engagement, and reten-
social psychology research on unconscious bias
tion of diverse employees.98 The company also offers
and change management techniques.100 The Coca-
a variety of diversity education programs that have
Cola Company’s commitment to diversity has
evolved from minimizing conflict to strengthening the
helped it to succeed in its industry and develop a
company’s ability to amplify, respect, value, and
strong positive corporate reputation, becoming one
leverage employee differences to influence sustain-
of Fortune’s top 10 Most Admired Companies six
able business outcomes.99
years in a row.101
major driver for other forms of organizational change. It also has widespread
effects on the behaviors of people inside an organization. Three specific areas
of technology relevant to the study of organizational behavior are (1) the shift
toward a service-based economy; (2) the growing use of technology for competitive advantage; and (3) mushrooming change in information technology.
Although ethics has long been relevant to businesses and managers, what
seems like an epidemic of ethical breaches in recent years have placed ethics
in the mainstream of managerial thought toda y. One special aspect of business ethics, corporate governance, has also taken on increased importance.
Ethics also increasingly relate to information technology. A central issue today
revolves around the fact that rapid changes in business relationships, organizational structures, and financial systems pose unsurpassed difficulties in
keeping accurate track of a company’s financial position.
A final significant area of organizational change facing organizations today
involves new employment relationships. Knowledge workers add value to a
business because of what they know. How well these employees are managed is
seen as a major factor in determining which firms will succeed. Outsourcing is
the practice of hiring other firms to do the work previously performed by the
organization itself. It is an increasingly popular strategy because it helps firms
focus on their core activities and a void getting sidetrac ked by secondary
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
LOSKUTNIKOV/SHUTTERSTOCK.COM
CHAPTER 2 | The Changing Environment of Organizations 78
PART 1 | Introduction to Organizational Behavior
activities. However, it grows controversial when the jobs being outsourced are
really being exported to foreign countries in ways that reduce domestic job
opportunities. Contingent and temporary workers and the creation of a tiered
workforce also pose special challenges. These challenges center around the
treatment of various groups (suc h as contingent or lower-tier workers) compared to other groups (such as permanent or higher-tier employees).
DISCUSSION QUESTIONS
1. Which do you think is more important to team performance , surface-level
or deep-level diversity? Why?
2. How can diversity create a competitive advantage for a firm?
3. If a subordinate came to you and said that they felt the company’ s new
diversity hiring initiative was unfair and would compromise their welldeserved opportunities for advancement, how would you respond?
4. What can leaders do to be effective when team members are from different
cultures and ha ve different expectations about how the leader should
behave?
5. Identify at least three ways in which the globalization of business affects
businesses in your community.
6. What roles do changing technologies play in your daily activities?
7. Do you think that concerns regarding ethics will become more or less
important in business? Why?
8. What are your personal opinions about international outsourcing in the
garment industry? Do you think that lower prices are worth sending U.S.
jobs to other countries? Explain your answer.
UNDERSTAND YOURSELF EXERCISE
Global Perspective
This Chapter’s Understand Yourself feature gave you the opportunity to evaluate your global perspective. Global perspective is characterized by high levels
of both conceptualization, or the ability to think globally, and contextualization, or the ability to act locally and adapt to the local environment. Although
both thinking globally and acting locally are important to managers, most
managers are more adept at thinking globally than at acting locally because of
the uniqueness of local cultures.
Reflect on the nature of some of the interactions that you ha ve had with
people from other cultures. These interactions could have been in person during class, at a store, or even over the phone with a customer service agent.
Next, answer the following questions:
1. Do you think that you were equally able to think and act locally as you
interacted with people from other cultures?
2. What did you do well, and what could you ha ve done better in these
interactions?
3. What multicultural experiences can you seek out to enhance your
global perspective?
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations GROUP EXERCISE
What Does Culture Mean to You?
This exercise is done as a class, and the instructor plays the role of class secretary. First working alone, think about what “societal culture” means. For five
minutes, think about your own culture. Write down how you think a diction ary would define the word, then write down all of the cultural dimensions you
can think of that you would use to describe it.
After five minutes, the instructor will call on students to share some of their
ideas and record them on a c halkboard, flip chart, or something else. Try to
identify categories into which the ideas can be placed. Then answer the following questions as a class.
Questions
1. How might multiculturalism create a competitive advantage for an
organization?
2. What categories are the most important to teams working in
organizations?
3. What categories are the least important to teams working in
organizations?
4. What does your list suggest that managers wanting to promote a multicultural workplace might do?
VIDEO EXERCISE
thical Decision Making at Black Diamond
E
Equipment
Black Diamond Equipment specializes in climbing and skiing equipment. The
global company looks for employees who share the company’s attitude, values,
and passion toward outdoor sports and ethical values . Black Diamond also
promotes fair labor practices, sustainability, and low environmental impact.
As a class, watch “Black Diamond Equipment” and then individually
consider the following questions . After you ha ve come up with your own
ideas, form groups of four to five people and discuss your insights . Be sure
to nominate someone to serve as a spokesperson to share your ideas with
the class.
1. How does Blac k Diamond integrate social responsibility into its
culture?
2. How does the global nature of the company and its markets influence
how it thinks about employee diversity?
3. How would you describe Blac k Diamond’s ethics in terms of how it
treats its employees at the company’ s factory partners in Vietnam,
China, and Bangladesh? Do you think that it is appropriate for firms
like Black ­Diamond to scrutinize its partner factories like this?Why or
why not?
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
79
PART 1 | Introduction to Organizational Behavior
VIDEO C A S E
PERCOM/SHUTTERSTOCK.COM
80
Now What?
Imagine trying to write a project status report for Happy Time Toys with three
other team members when an older team member tries to take the project over,
believing that you’re too inexperienced to do a good job. What do you say or do? Go
to this chapter’s “Now What?” video, watch the challenge video, and choose a
response. Be sure to also view the outcomes of the two responses you didn’t h
c oose.
Discussion Questions
ENDNOTES
1. What type(s) of barriers to inclusion exist for this group?
2. How can diversity be leveraged as a source of competitive advantage
for this group?
3. If you were the CEO of Happy Time Toys, how would you create a culture of inclusion to help your company realize the benefits of not only
age-related diversity but all types of diversity?
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54 Chen, Y.-R., Leung, K., & Chen, C. C. (2009). Bringing
National Culture to the Table: Making a Difference with
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PART 1 | Introduction to Organizational Behavior
pp. 217–250). London: Routledge, Taylor & F rancis Group.
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58Yamaguchi, T. (1988, February). The Challenge of Interna-
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59Hofstede, G. (1980). Culture’s Consequences: International
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60Kedia, B. L., & Mukherji, A. (1999). Global Managers: Devel-
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61Rhinesmith, S. H. (1992). Global Mindsets for Global Man -
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62Levy, O., Beechler, S., Taylor, S., & Boyacigiller, N. (2007).
71Kahn, J. (2000, March 20). Presto Chango! Sales Are Huge.
Fortune, 90–96; More Firms Falsify Revenue to Boost Stocks.
USA Today, March 29, 2000, 1B.
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74Walmart’s Discounted Ethics. Time, May 7, 2012, p. 19.
75 How U.S. Concerns Compete in Countries
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76Alcoa Faces Allegation by Bahrain of Bribery. Wall Street
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77How to Fix Corporate Governance. Business Week, May 6,
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78Carroll, A. B. & Buchholtz, A. K. (2012). Business & Society:
Ethics, Sustainability, and Stakeholder Management (8th ed.).
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79Sanders, T. (2008). Saving the World at Work. New York:
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80Maon, F., Lindgreen, A., & Swaen, V. (2010). Organizational
Stages and Cultural Phases: A Critical Review and a Consolidative Model of Corporate Social Responsibility Development.
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81 Rupp, D. E., Williams, C. & Aguilera, R. (2011). Increas-
ing Corporate Social Responsibility through Stakeholder
Value Internalization (and the Catalyzing Effect of New
Governance): An Application of Organizational Justice, SelfDetermination, and Social Influence Theories. In Managerial Ethics: Managing the Psyc hology of Morality , ed.
M. Schminke. New York: Routledge/Psychology Press.
82McClellan, J. (2008, June 27). Get Your Employees Excited
About Sustainability. Society for Human Resource Manage ment. Available online: http://www.shrm.org/hrdisciplines/
ethics/-articles/pages/employeesandsustainability.aspx.
What We Talk About When We Talk About “Global Mindset”:
Managerial Cognition in Multinational Corporations. Journal
of International Business Studies, 38, 231–258.
83Wasserman, T. (2011, June 9). Google Offers Employees 30
More Electric Cars to Share, Mashable.com. Available online:
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63Wankel, C. (2007). 21st Century Management: A Reference
84McClellan, J. (2008, June 27). Get Your Employees Excited
About Sustainability. Society for Human Resource Manage ment. Available online: http://www.shrm.org/hrdisciplines/
ethics/-articles/pages/employeesandsustainability.aspx.
Handbook (Vol. 1). New York: Sage.
64Kedia, B. L. & Englis, P. D. (2011). Transforming Business
Education to Produce Global Managers . Business Horizons,
54(4), 325–331.
65See Fox, A. (2010, January). At Work in 2020. HR Magazine,
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66Arora, A., Jaju, A., Kefalas, A. G., & Perenich, T. (2004). An
Exploratory Analysis of Global Managerial Mindsets: A Case
of U.S. Textile and Apparel Industry. Journal of International
Management,10, 393–411.
85 For additional information, see http://www.iso.org/iso/
iso_ catalogue/management_standards/iso_9000_iso_14000/
qmp.htm.
86Boisot, M. (1998). Knowledge Assets. Oxford, UK: Oxford
University Press.
87Tushman, M. L., & O’Reilly, C. A. (1996). Winning Through
Innovation. Cambridge, MA: Harvard Business School Press.
67Employment Projections: 2012–2022 Summary, U.S. Bureau
of Labor Statistics, December 19, 2014.
88Von Glinow, M. A. (1988). The New Professionals. Cambridge,
MA: Ballinger.
68Quittner, J. (2010, March 1). The Future of Reading. Fortune,
89Lee, T. W., & Maurer, S. D. (1997). The Retention of Knowl-
62–67.
69CareerBuilder Releases Annual List of the Most Unusual
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CareerBuilder, October 27, 2010.
edge Workers with the Unfolding Model of Voluntary Turnover. Human Resource Management Review 7, 247–276.
90 Milkovich, G. T. (1987). Compensation Sy stems in High-
Technology Companies. In High Technology Management, eds.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 2 | The Changing Environment of Organizations A. Klingartner and C. Anderson. Lexington, MA: Lexington
Books.
91http://www.hewittassociates.com/OutsourcingStudy_2009_
Results.pdf, March 21, 2010.
83
50–58; see also Ho, V. (2005, January). Social Influence on
Evaluations of Psychological Contract Fulfillment. Academy
of Management Review, 113–128.
92Zeidner, R. (2010, February). Heady Debate—Rely on Temps
or Hire Staff? HR Magazine, 28–33.
97Guzzo, R. A., Noonan, K. A., & Elron, E. (1994). Expatriate
Managers and the Psychological Contract. Journal of Applied
Psychology, 79(4), 617–626.
93 Harley Union Makes Concessions . Wall Street J ournal,
98 The Coca-Cola Company: No. 33 in the DiversityInc
94Ford to Begin Hiring at New Lower Wages. Wall Street Journal, January 26, 2010, B1.
99Diversity Education and Training. The Coca-Cola Company,
December 3, 2009, B3.
95Rousseau, D. M., & Parks, J. M. (1993). The Contracts of
Individuals and Organizations . In Research in Organiza tional Behavior, eds. L. L. Cummings & B. M. Staw (Vol. 15,
pp. 1–43). Greenwich, CT: JAI Press. See also Rousseau, D. M.
(2010). The Individual-Organization Relationship: The Psychological Contract. In Handbook of Industrial and Organi zational Psychology, ed. S. Zedeck. Washington, DC: American
Psychological Association.
96Rousseau, D. M. (1996, February). Changing the Deal While
Keeping the P eople. Academy of Management Executive ,
Top
50. 2015. Available online: http://www.diversityinc.com/
the-coca-cola-company/.
2015. Available online: http://www.coca-colacompany.com/
our-company/diversity/diversity-education-training.
100Coca-Cola Enterprises—Thais Compoint. Profiles in Diversity
Journal, 2015. Available online: http://www.diversityjournal.
com/14365-coca-cola-enterprises-thais-compoint/.
101Coca-Cola No. 10 on Fortune’s 2015 List of World’s Most
Admired Companies. Coca-Cola Journey, February 19, 2015.
Available online: http://www.coca-colacompany.com/coca-colaunbottled/coca-cola-no-10-on-fortunes-2015-list-of-worldsmost-admired-companies.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
PART
2
INDIVIDUAL BEHAVIORS AND
PROCESSES IN ORGANIZATIONS
CHAPTER 3 Individual Characteristics
CHAPTER 4 Individual Values, Perceptions, and Reactions
CHAPTER 5 Motivating Behavior
M
SH ON
U G
TT M
ER UL
ST TI
O PL
CK Y/
.C
O
M
LOSKUTNIKOV/SHUTTERSTOCK.COM
CHAPTER 6 Motivating Behavior with Work and Rewards
As we discussed in Chapter 1, managers strive to enhance performance behaviors, enhance commitment and
engagement, promote citizenship behaviors, and minimize dysfunctional behaviors by their employees.
Chapter 2 identified how various environmental factors—diversity, globalization, technology, ethics, and new
employment relationships—all impact organizational behavior.
We now turn to a fundamental question underlying organizational behavior: Why do individuals do what
they do? Chapter 3 identifies and discusses critical individual characteristics that affect people’s behaviors in
organizations. The discussion of other important individual characteristics is continued in Chapter 4. Core
theories and concepts that drive employee motivation are introduced and discussed in Chapter 5. Finally, in
Chapter 6 we focus on how managers can implement motivation theories and concepts.
How does the
environment matter?
Why do individuals
do what they do?
• Individual
characteristics
• Individual values,
perceptions, and
reactions
• Motivating behavior
• Motivating behavior
with work and
rewards
Why does leadership
matter?
• Traditional leadership
approaches
• Modern leadership
approaches
• Power, influence, and
politics
What makes managers
and organizations effective?
• Enhancing performance
behaviors
• Enhancing commitment and
engagement
• Promoting citizenship
behaviors
• Minimizing dysfunctional
behaviors
How does the
environment matter?
Why do groups and
teams do what they
do?
• Groups and teams
• Decision making and
problem solving
• Communication
• Conflict and
negotiation
How do
organizational
characteristics
influence
effectiveness?
• Organization structure
and design
• Organization culture
• Change management
PHANT/SHUTTERSTOCK.COM
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
LOSKUTNIKOV/SHUTTERSTOCK.COM
CHAPTER
3
CHAPTER
OUTLINE
INDIVIDUAL CHARACTERISTICS
Real World Challenge: Individual
Differences That Make a Difference at
Southwest Airlines
PEOPLE IN ORGANIZATIONS
Individual Differences
The Concept of Fit
Realistic Job Previews
PERSONALITY AND INDIVIDUAL
BEHAVIOR
The “Big Five” Framework
The Myers-Briggs
Framework
OTHER IMPORTANT PERSONALITY
TRAITS
Locus of Control
Understand Yourself: Work Locus of
Control
Self-Efficacy
Self-Esteem
Authoritarianism
After studying this chapter, you should be
able to:
LEARNING
OUTCOMES
1 Explain the nature of individual
differences, the concept of fit, and the
role of realistic job previews.
2 Define personality and describe
general personality frameworks and
attributes that affect behavior in
organizations.
Machiavellianism
Tolerance for Risk and Ambiguity
Type A and B Traits
The Bullying Personality
Improve Your Skills: Challenging
Managerial Behaviors and How to
Respond
Role of the Situation
Global Issues: How Others See
Americans
INTELLIGENCE
General Mental Ability
Multiple Intelligences
Emotional Intelligence
Case Study: Emotional Intelligence at
FedEx
LEARNING STYLES
Sensory Modalities
Learning Style Inventory
Learning Style Orientations
3 Identify and discuss other important
personality traits that affect behavior
in organizations.
4 Discuss different kinds of intelligence
that affect behavior in organizations.
5 Describe different learning styles
that influence how people process
information and that affect behavior
in organizations.
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INDIVIDUAL DIFFERENCES THAT MAKE A
DIFFERENCE AT SOUTHWEST AIRLINES
Fun and friendly customer service is essential to the success of Southwest Airlines’ business
strategy.1 Southwest’s Vice President of People feels that fun balances the stress of hard
work. Because Southwest believes that fun is about attitude, it hires for personality and
attitude. Former CEO Herb Kelleher believes that with the exception of a few technically
oriented positions such as pilots, Southwest can train new hires on whatever they need to
do, but it cannot change employees’ inherent nature.2
Southwest Airlines’ mission statement includes, “Creativity and innovation are encouraged
for improving the effectiveness of Southwest Airlines.”3 To support its goals of hiring fun, creative, innovative employees, Southwest Airlines looks for leadership and a sense of humor in
the people it hires. The company looks for empathetic people with other-oriented, outgoing personalities who work hard and have fun at the same time. Southwest’s learning-oriented, fun culture gives employees the freedom to be themselves and become passionate about their jobs.4
Southwest asks for your advice about how to better hire empathetic employees with
creativity and fun-loving characteristics who fit with the company’s unique culture. After
reading this chapter, you should have some good ideas.
LOSKUTNIKOV/SHUTTERSTOCK.COM
REAL WORLD CHALLENGE
BRIAN CAHN/CORBIS WIRE/CORBIS
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88
PART 2 | Individual Behaviors and Processes in Organizations
Think about human behavior as a jigsaw puzzle. Puzzles consist of various
pieces that fit together in precise w ays. And of course, no two puzzles are
exactly alike. They have different numbers of pieces, the pieces are of different sizes and shapes, and they fit together in different ways. The same can
be said of human behavior and its determinants. Each of us is a whole picture, like a fully assembled jigsaw puzzle, but the puzzle pieces that define
us and the way those pieces fit together are unique. Every person in an organization is fundamentally different from everyone else . To be successful,
managers must recognize that these differences exist and attempt to understand them.
In this chapter we explore some of the key characteristics that differentiate people from one another in organizations. We first introduce the essential nature of individual differences and how people “fit” as individuals in
organizations. We then look at personality frameworks that shed consider able light on different personality profiles. Next, we examine other specific
personality traits and discuss different types of intelligence . We close this
chapter with an examination of different styles for processing information
and learning.
PEOPLE IN ORGANIZATIONS
As a starting point for understanding the behavior of people in organizations,
let’s first examine the basic nature of the individual–organization relation ship. First we expand a bit further on the concept of individual differences and
then introduce different forms of “fit” between people and organizations.
Individual Differences
individual differences
Personal attributes that
vary from one person to
another
As already noted, every individual is unique. Individual differences are personal attributes that vary from one person to another. Individual differences
may be physical, psychological, and emotional. The individual differences that
characterize a specific person make that person unique. As we see in both this
chapter and Chapter 4, basic categories of individual differences include personality, intelligence, learning styles, attitudes, values and emotions, perception, and stress.
Are the specific differences that characterize a given person good or bad?
Do they contribute to or detract from performance? The answer, of course, is
that it depends on the circumstances. One person may be dissatisfied, withdrawn, and negative in one job setting but satisfied, outgoing, and positive in
another. Working conditions, coworkers, and leadership are just a few of the
factors that affect how a person performs and feels about a job . Thus, whenever a manager attempts to assess or account for individual differences
among her employees, she must also be sure to consider the situation in
which behavior occurs. In addi tion, as dis cussed in Chapter 2, managers
should also be aware of psychological contracts that exist between the organization and its employees. In an ideal situation, then, understanding differences across people and creating effective psyc hological contracts can help
facilitate a good fit between people and the organization.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 3 | Individual Characteristics
89
The Concept of Fit
Why are some very talented people undesirable coworkers or employees
despite being very talented at what they do?The answer lies in the many ways
in which people need to fit with an employment opportunity to be a successful
match. Being good at our job is important, but is not enough—we need to fit
with our organization and workgroup as well. That is, there are actually different forms of fit.5 These different forms of fit are summarized in Table 3.1.
Person-Job Fit
Person-job fit is the fit between a person’s abilities and the demands of the
job, and the fit between a person’s desires and motivations and the attributes
and rewards of a job.6 An employee’s talents need to meet a job’s requirements,
and the job needs to meet the employee’s needs and motivations.7 Because job
performance is usually the most important determinant of an employee’ s success, person-job fit is usually the primary focus of most staffing efforts. From
the employee’s perspective, if the job does not meet his or her financial, career,
lifestyle, and other needs, then the match is not ideal. An individual motivated
by commissions and merit pay is not likely to be a good fit with a job based on
teamwork and group rew ards. Similarly, an individual who does not enjoy
working with people is not likely to succeed in a sales position. It is important
person-job fit
The fit between a
person’s abilities and the
demands of the job, and
the fit between a person’s
desires and motivations
and the attributes and
rewards of a job
Table 3.1
Dimensions of Fit
Type of Fit
Possible Dimensions of Fit
Person-Job Fit: Does the person meet the
needs of the job and does the job meet
the needs of the person?
Intelligence
Job-related skills
Job knowledge
Previous work experience
Personality related to performing job tasks
Person-Group Fit: Does the employee fit
the workgroup, including the supervisor?
Teamwork skills
Knowledge and ability relative to other
team members
Conflict management style
Preference for teamwork
Communication skills
Personality related to working well with others
Person-Organization Fit: Do the individual’s
values, beliefs, and personality fit
the values, norms, and culture of the
organization?
Alignment between personal motivations
and the organization’s culture, mission,
and purpose
Values
Goals
Person-Vocation Fit: Do the person’s
interests, abilities, values, and
personality fit his or her occupation?
Aptitudes
Interests
Personal values
Long-term goals
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
90
PART 2 | Individual Behaviors and Processes in Organizations
E/GETT
Y IMAG
ES
Fit is an important concept in organizations. Take this woman, for
example. Her job appears to require her to deal with binders full of
information. She may find this work interesting, or she may find it
tedious and boring. Person-job, person-group, person organization, and
person-vocation fit are all important factors in organizational behavior.
to consider not only the fit between an individual’s talents and the job requirements ,
but also the fit between an individual’ s
motivations and the rewards offered by the
job. Research suggests that person-job fit
leads to higher job performance, satisfaction,
organizational commitment, and intent to
stay with the company.8 Because people differ
in their personality and motivations as well as
their skills, consider individual differences
beyond skills when making hiring decisions.
Person-Group Fit
IMAGE
SOURC
In addition to fit with the job, the fit between the
employee and his or her workgroup and supervisor is also important. Good person-group fit (or
person-team fit) means that an individual fits
with the workgroup’s work styles, skills, and goals.
Person-group fit recognizes that employees often
must work effectively with their supervisor, workgroup, and teammates to be
successful. Person-group fit leads to improved job satisfaction, organizational
commitment, and intent to stay with the company.9 Teamwork, communication,
and interpersonal competencies can be as critical to team performance as team
members’ ability to perform core job duties. Person-group fit is thus particularly
important in team-oriented work environments.10 An executive at Men’s Wearhouse once terminated one of the men’s suits retail store’s most successful salespeople because he focused only on maximizing his own sales as opposed to
working with the other sales staff as a team. After firing the salesperson, sales
at the store where he worked increased significantly.11
person-group fit (or
person-team fit)
The extent to which
an individual fits with
the workgroup’s and
supervisor’s work styles,
skills, and goals
person-organization fit
The fit between an
individual’s values,
beliefs, and personality
and the values, norms,
and culture of the
organization
Person-Organization Fit
Person-organization fit is the fit between an individual’ s values, beliefs,
and personality and the values, norms, and culture of the organization.12 The
strength of this fit influences important organizational outcomes inc luding
job performance, retention, job satisfaction, and organizational commitment. 13 Organizational values and norms that are important for personorganization fit inc lude integrity, fairness, work ethic , competitiveness,
cooperativeness, and compassion for fellow employees and customers . Person-organization fit has a strong positive relationship with job satisfaction,
organizational commitment, and intent to sta y with the company, and can
influence employee attitudes and citizenship beha viors beyond the job
requirements, such as helping others or talking positively about the firm.14
It also has a modest impact on turnover and tenure , but little to no impact
on meeting job requirements . 15 Despite the potential overlap between
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 3 | Individual Characteristics
Person-group fit is the fit between an individual and their
group or team. The bored individual on the left may not be
a good fit with the rest of her team members, who seem
engaged and attentive.
REAKM
WAVEB
EDIA/SH
UTTER
OM
STOCK.C
person-job and person- ­
organization fit, research suggests that people ma y
experience differing degrees of
fit with the job and with the
organization.16 Essentially, it is
possible to like what you do but
not where you do it, or to like
where you work but not what
you do there.
So how c an y ou m aximize
person-organization fit? A good
place to start is to identify those
qualifications, competencies, and
traits that relate to the organization’s strategy, values, and processes and hire people with those
characteristics. For example, even if
Maria is technically well qualified as a researcher, if she avoids risk, is indecisive, and tends to ruminate over a decision, she may be unsuccessful in an
innovative, fast-paced company. Online shoe retailer Zappos.com attributes
its success to its culture of great customer service, high energy, and employee
autonomy. Because it does not monitor its customer service agents’ call times
or give them scripts, it is critical to make sure they are a good fit with the
Zappos culture. One of the ways the company does that is to offer new customer service agents $2,000 to leave the company after the initial training
period if they feel that they are a poor fit.17 To find the best matches for their
culture and business, The Container Store’s online application includes questions asking job candidates to reveal their favorite Container Store product.
Additional questions explore communications skills and other c haracteristics. Using the website also helps the candidate learn more about the com pany and be better prepared for an interview. This process helps to persuade
strong candidates that The Container Store is a good fit for their interests
and needs.
Employees must be able and willing to adapt to a company by learning ,
negotiating, enacting, and maintaining the beha viors appropriate to the
company’s environment. 18 To successfully adapt, employees must be openminded and have sufficient information about organizational expectations
and standards and their own performance in light of those standards .
Employees also must be able and willing to learn new beha viors and habits
(e.g., low anxiety, high self-esteem, good time management skills, etc.).
Of course, hiring for any type of fit does not mean simply hiring those with
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
91
92
PART 2 | Individual Behaviors and Processes in Organizations
whom we are most comfortable, which can lead to dysfunctional stereotyping
and discrimination against people who may actually contribute a great deal
to the company’s success.
person-vocation fit
The fit between a person’s
interests, abilities, values,
and personality and a
profession
Person-Vocation Fit
Person-vocation fit is the fit between a person’s interests, abilities, values,
and personality and a profession. 19 Our adjustment and satisfaction are
greater when our occupation meets our needs. For example, a social individual
who is low in conscientiousness and dislikes working with numbers would be
a poor fit with the engineering vocation. Although individuals usually choose
a vocation long before applying to an organization, understanding personvocation fit can still be useful to organizations and managers. Companies
wanting to develop their own future leaders , or smaller organizations that
need employees to fill multiple roles, may be able to use vocational interests
in determining whether job applicants would be a good fit with the
­organization’s future needs.
Some people pursue two or more different vocations over the course of
their careers because they ha ve diverse interests or because they become
bored working a long time in the same career. Organizations may better retain
valued career changers by understanding their vocational preferences and
designing career tracks for them that place them in new roles in the organization over time that are consistent with their vocational interests and apti tudes. This allows valued employees who would otherwise be likely to lea ve
the organization to pursue a different type of vocationto pursue multiple vocations within the company.
Realistic Job Previews
realistic job previews
(RJPs)
Involve the presentation
of both positive and
potentially negative
information to job
candidates
When communicating the nature of the work and the organization to job candidates, companies can choose how objective to be. Many firms choose to disclose as little potentially undesirable information as possible to reduce the
chance that it will make the position unappealing . Essentially, some firms
believe that if they tell recruits what it is really like to work there, the recruits
will not want the job. However, this focus on hiring people without giving them
a thorough understanding of what they are getting themselves into can backfire. Different people prefer different types of jobs and organizations . Once
hired, they will obviously learn what the work and organizational culture are
really like. If the fit is not good once people start work, they tend to leave.
Companies are increasingly putting interactive features and questionnaires
on their websites to communicate their culture and give applicants insights
into what it is like to work there. This increases the accuracy of new employees’ expectations, and decreases psychological contract violations.
Realistic job previews (RJPs) involve the presentation of both positive
and potentially negative information to job candidates. Rather than trying to
sell candidates on the job and company by presenting the job opportunity in
the most positive light, the company strives to present an accurate picture
through an RJP. The goal is not to deter candidates , but rather to provide
accurate information about the job and organization and build trust. 20 Hiring
customers and using employee referrals are among the methods many companies use to give job candidates realistic information about what it would be
like to work at that company.
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CHAPTER 3 | Individual Characteristics
93
If a common reason for employees leaving an organization is that the
job is not what they expected, this is a good sign that the recruiting mes sage can be improved. Giving applicants the opportunity to self-select out
of the hiring process if they do not perceive themselves to be good fits with
the position or organization increases the likelihood that the applicants
ultimately hired will be good fits and will be better employees as a result.
Given the relatively low cost associated with their development, RJPs may
be useful for organizations trying to reduce turnover rates for jobs that
departing employees say were not what they expected when they accepted
job offers.
PERSONALITY AND INDIVIDUAL
BEHAVIOR
Let’s now begin to focus more specifically on the role and importance of an
individual’s personality as it relates to both work outcomes and the various
forms of it. Personality is the relatively stable set of psychological attributes
that distinguish one person from another. A longstanding debate among psychologists—often expressed as “nature versus nurture”—concerns the extent
to which personality attributes are inherited from our parents (the “nature”
argument) or shaped by our environment (the “nurture” argument). In reality,
both biological and environmental factors play important roles in determining
our personalities.21 Although the details of this debate are beyond the scope of
our discussion here, managers should strive to understand basic personality
attributes and how they can affect people’s behavior and fit in organizational
situations, not to mention their perceptions of and attitudes tow ard the
organization.
personality
The relatively stable set of
psychological attributes
that distinguish one
person from another
The “Big Five” Framework
Psychologists have identified literally thousands of personality traits and
dimensions that differentiate one person from another. But in recent years,
researchers have identified five fundamental personality traits that are espe cially relevant to organizations.22 These traits, illustrated in Figure 3.1, are
now commonly called the “Big Five” personality traits. As suggested by the
figure, the personality of any given person can fall anywhere along each of
these five traits.
Agreeableness refers to a person’ s ability to get along with others .
­Agreeableness causes some people to be gentle, cooperative, forgiving, understanding, and good-natured in their dealings with others. Lack of it results in
others’ being irritable, short-tempered, uncooperative, and generally antagonistic toward other people. Researchers have not yet fully investigated the
effects of agreeableness, but it seems likely that highly agreeable people are
better at developing good working relationships with coworkers, subordinates,
and higher-level managers, whereas less agreeable people are not likely to
have particularly good working relationships. The same pattern might extend
to relationships with customers , suppliers, and other key organizational
constituents.
“Big Five” personality
traits
A set of five fundamental
traits that are especially
relevant to organizations
agreeableness
The ability to get along
with others
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94
PART 2 | Individual Behaviors and Processes in Organizations
Figure 3.1
The “big five” personality
framework is currently
very popular among
researchers and
managers. These five
dimensions represent
fundamental personality
traits presumed to
be important in
determining the
behaviors of individuals
in organizations. In
general, experts agree
that personality traits
closer to the left end of
each dimension are more
positive in organizational
settings, whereas traits
closer to the right are less
positive.
“Big Five” personality traits
Agreeableness
High Agreeableness
High Conscientiousness
Low Agreeableness
Conscientiousness
Low Conscientiousness
Neuroticism
Less Neurotic
More Neurotic
Extraversion
Extraversion
Introversion
Openness
More Openness
conscientiousness
Refers to an individual
being dependable and
organized
neuroticism
Characterized by a
person’s tendency to
experience unpleasant
emotions such as anger,
anxiety, depression, and
feelings of vulnerability
extraversion
The quality of being
comfortable with
relationships
Less Openness
Conscientiousness refers to the extent to which a person can be counted
on to get things done. Some people, for example, are organized, detail-oriented,
responsible, dependable, and plan carefully to order to meet deadlines. These
individuals can be characterized as being strong on conscientiousness. Less
conscientious people may be prone to missing deadlines, overlooking various
tasks, being unorganized, and being generally less dependable. In general,
research suggests that being strong on conscientiousness is often a good pre dictor of job performance for many jobs.
The third of the Big Five personality dimensions is neuroticism. People
who are relatively more neurotic tend to experience unpleasant emotions such
as anger, anxiety, depression, and feelings of vulnerability more often than do
people who are relatively less neurotic. People who are less neurotic are relatively poised, calm, resilient, and secure; people who are more neurotic are
more excitable, insecure, reactive, and subject to extreme mood swings. People
with less neuroticism might be expected to better handle job stress , pressure,
and tension. Their stability might also lead them to be seen as being more reliable than their less stable counterparts.
Extraversion reflects a person’ s comfort level with relationships .
­Extroverts are sociable, talkative, assertive, and open to establishing new
relationships. Introverts are much less sociable, talkative, and assertive, and
more reluctant to begin new relationships. Research suggests that extroverts
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CHAPTER 3 | Individual Characteristics
95
Conscientiousness refers to the extent that a person can be counted
on to get things done. This group is acknowledging the work of one
of their colleagues and his efforts to help them complete a project on
time. He most likely has a high level of conscientiousness. Further,
given how his colleagues seem to genuinely like him he most likely
also has a high degree of agreeableness.
DAVID
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tend to be higher overall job
performers than introverts
and that they are more likely
to be attracted to jobs based on
personal relationships, such as
sales and marketing positions.
For this particular trait, the
opposite version is also given a
name—introversion. An introvert tends to be less comfortable
in social situations.
Finally, openness reflects a
person’s rigidity of beliefs and
range o f i nterests. P eople w ith
high levels of openness are willing
to listen to new ideas and to
change their own ideas , beliefs ,
and attitudes in response to new
information. They also tend to have
broad interests and to be curious ,
imaginative, and creative . On the
other hand, people with low levels
of openness tend to be less receptive to new ideas and less­willing to change their minds. Further, they tend
to have fewer and narrower interests and to be less curious and cre ative.
People with more openness might be expected to be better performers due
to their flexibility and the likelihood that they will be better accepted by
others in the organization. Openness may also encompass a person’s willingness to accept change; people with high levels of openness ma y be more
receptive to change, whereas people with little openness may resist change.
The Big F ive framework continues to attract the attention of both
researchers and managers. The potential value of this framework is that it
encompasses an integrated set of traits that appear to be valid predictors of
certain behaviors in certain situations. Thus, managers who can both understand the framework and assess these traits in their employees are in a good
position to understand how and why they behave as they do. On the other
hand, managers must be careful to not overestimate their ability to assess the
Big Five traits in others. Even assessment using the most rigorous and valid
measures is likely to be somewhat imprecise. There are also times when using
more specific personality traits to predict outcomes such as turnover or performance are more useful than the more general Big Five traits because the more
specific trait more directly influences the intended outcome. For example, if
you are trying to hire a strong team pla yer for a diverse creative team, individual differences including a preference for teamwork and other group
introversion
The tendency to be
less comfortable in
relationships and social
situations
openness
The capacity to entertain
new ideas and to change
as a result of new
information
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96
PART 2 | Individual Behaviors and Processes in Organizations
orientation (a preference for working with diverse others) may outperform any
of the Big Five traits in predicting performance. Another limitation of the Big
Five framework is that it is primarily based on researc h conducted in the
United States. Thus, generalizing it to other cultures presents unanswered
questions. Even within the United States, a variety of other factors and traits
are also likely to affect behavior in organizations.
The Myers-Briggs Framework
The Myers-Briggs framework is also a popular framework that some people
use to characterize personality. Many people know of this framework through
a widely-used questionnaire called the Myers-Briggs Type Indicator, or MBTI.23
More than 2 million people worldwide take the self-assessment inventory
every year.24 It is based upon Carl J ung’s work on psychological types. Psychologist Carl Jung was a contemporary of Sigmund F reud and a leading
exponent of Gestalt personality theory. The MBTI was first developed by Isabel Briggs Myers (1897–1979) and her mother, Katharine Cook Briggs, to help
people understand themselves and each other so that they could find work
that matches their personality. They put Jung’s concepts into everyday language. Isabel Myers’s 1980 book Gifts Differing, and her philosophy of cele brating individual differences, encouraged the workplace diversity movement.
The MBTI uses four scales with opposite poles to assess four sets of prefer ences. The four scales are:25
1. Extroversion (E)/Introversion (I): Extroverts are energized by things and
people. They are interactors and “on the fly” thinkers whose motto is ,
“ready, fire, aim.” Introverts find energy in ideas, concepts, and abstractions. They can be social, but also need quiet time to recharge their batteries. They are reflective thinkers whose motto is, “ready, aim, aim.” Do you
like to focus on the outer world (extroversion) or on your own inner world
(introversion)?
2. Sensing (S)/Intuition (N): Sensing people are detail oriented. They want
and trust facts. Intuitive people seek out patterns and relationships among
the facts they have learned. They trust their intuition and look for the “big
picture.” Do you prefer to focus on the information you take in (sensing) or
do you like to interpret and add meaning (intuition)?
3. Thinking (T)/Feeling (F): Thinkers value fairness , and decide things
impersonally based on objective criteria and logic. Feelers value harmony,
and focus on human values and needs as they make decisions or judgments. When you make decisions, do you like to first look at logic and consistency (thinking) or at the people and special circumstances involved
(feeling)?
4. Judging (J)/Perceiving (P): Judging people are decisive and tend to plan.
They focus on completing tasks, take action quickly, and want to know the
essentials. They develop plans and follow them, adhering to deadlines. Perceptive people are adaptable, spontaneous, and curious. They start many
tasks, and often find it difficult to complete them. Deadlines are meant to
be stretched. In dealing with the world, do you like to get things decided
quickly (judging) or do you prefer to sta y open to new information and
options (perceiving)?
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CHAPTER 3 | Individual Characteristics
97
The possible combinations of these preferences result in sixteen personality types, which are identified by the four letters that represent one’ s tendencies on the four scales. For example, ENTJ reflects extraversion, intuition,
thinking, and judging. You can complete a brief Myers-Briggs type self-assessment online at http://www.humanmetrics.com/cgi-win/JTypes2.asp.
Although the framework and Myers-Briggs instrument were not devel oped or intended to be used to identify personality profiles and label people,
too often this is what is done with the results . This is problematic as it can
lead to discrimination and poor career counseling. Employers should not hire,
fire, or assign employees by personality type, because the MBTI is not even
reliable at identifying a person’s type. When retested, even after intervals as
short as five weeks, as many as 50 percent of people are classified into a different type. There is little support for the c laim that the MBTI can justify job
discrimination or be a reliable aid to someone seeking career guidance.26 Jung
never intended for his work to be applied to a personality inventory. He noted,
“My scheme of typology is only a scheme of orientation. There is such a factor
as introversion, there is such a factor as extraversion. The classification of
individuals means nothing, nothing at all. It is only the instrumentarium for
the practical psychologist to explain, for instance, the husband to a wife or vice
versa.”27 Nonetheless, the MBTI has become so popular that it is likely that
you will encounter it during your career.28 It can be a fun team-building tool
for illustrating some of the ways that people differ, but it should not be used in
making organizational decisions including hiring and promotions.
OTHER IMPORTANT PERSONALITY TRAITS
Besides these complex models of personality, several other specific personality
traits are also likely to influence beha vior in organizations. Among the most
important are locus of control, self-efficacy, self-esteem, authoritarianism,
Machiavellianism, tolerance for risk and ambiguity, Type A and Type B traits,
and tendencies to bully. The role of the situation is also important.
Locus of Control
Locus of control is the extent to which people believe that their behavior has
a real effect on what happens to them. 29 Some people, for example, believe
that if they work hard they will succeed. They may also believe that people
who fail do so because they lack ability or motivation. People who believe that
individuals are in control of their lives are said to ha ve an internal locus of
control. Other people think that fate, chance, luck, or other people’s behavior
determines what happens to them. For example, an employee who fails to get
a promotion may attribute that failure to a politically motivated boss or just
bad luck, rather than to her or his own lac k of skills or poor performance
record. People who think that forces beyond their control dictate what hap pens to them are said to have an external locus of control. Table 3.2 summarizes the effects of locus of control on important organizational factors. This
chapter’s Understand Yourself feature gives you the opportunity to evaluate
your locus of control when it comes to work.
locus of control
The extent to which
one believes one’s
circumstances are a
function of either one’s
own actions or of external
factors beyond one’s
control
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98
PART 2 | Individual Behaviors and Processes in Organizations
Table 3.2
Effects of Locus of Control on Organizational Outcomes
Organizational Outcome Internal versus External Locus of Control
Job satisfaction
Internals are generally more satisfied with their job,
pay, supervisor, and coworkers.
Commitment
Internals are more committed and have lower
absenteeism.
Job motivation
Internals have greater task motivation, job involvement,
and self-confidence than do externals.
Job performance
Internals tend to have higher job performance than
externals.
Career success
Internals tend to earn a higher salary than do externals.
Conflict and stress
Internals report lower role conflict, work-family conflict,
burnout, and stress than do externals.
Social integration
Internals tend to be more socially integrated at work and
report more favorable relationships with their supervisors.
Source: See Ng, T.W.H., Sorensen, K.L., & Eby, L.T. (2006). Locus of Control at Work: A Meta-Analysis, Journal of
Organizational Behavior, 27, 1057–1087.
Self-Efficacy
self-efficacy
A person’s confidence
in his or her ability to
organize and execute
the courses of action
necessary to accomplish
a specific task
general self-efficacy
Your generalized belief
that you will be successful
at whatever challenges or
tasks you might face
Self-efficacy is our confidence in our ability to cope, perform, and be successful
on a specific task. It is possible to have high self-esteem (I generally like myself
and feel that I am a co mpetent person) but low self-efficacy for certain tasks
(I am poor at learning foreign languages). Self-efficacy is a key factor influencing motivation and engagement in an activity. It has also been found to reduce
the negative effect of low job autonomy on psychological and physical stress.30
General self-efficacy reflects a generalized belief that we will be successful at whatever challenges or tasks we might face.31 Because self-efficacy and
general self-efficacy are related to setting higher goals, persisting in the face
of obstacles, and performing better, it is important for you to maintain a posi tive sense of self-efficacy. Self-efficacy is even related to developing your skills,
setting more challenging goals, seeking social support, and persisting longer
in the face of challenges can help to build self-efficacy.
Self-Esteem
self-esteem
Our feelings of self-worth
and our liking or disliking
of ourselves
authoritarianism
The belief that power
and status differences
are appropriate
within hierarchical
social systems such as
organizations
Self-esteem refers to our feelings of self-worth and our liking or disliking of
ourselves.32 Research suggests that self-esteem is strongly related to motiva tional processes such as specific self-efficacy, self-set goals, and effort as well
as emotional ­processes, such as anxiety and regulating emotion. 33 Self-esteem is
positively related to job performance34 and learning.35
Authoritarianism
Another important personality characteristic is authoritarianism, the
extent to whic h a person believes that power and status differences are
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99
U N D E R S TA N D Y O U R S E L F
WORK LOCUS OF CONTROL
Using the scale below, write the number from 1 to 7 that
reflects your agreement or disagreement with the statements below. When you are finished, follow the scoring
instructions at the bottom to interpret your score.
strongly
slightly
disagree disagree disagree
1
2
3
neutral
slightly
agree
agree
4
5
6
___ 10. When it comes to landing a really good job, who
you know is more important than what you know.
___ 11. Promotions are given to employees who perform
well on the job.
___ 12. To make a lot of money you have to know the
right people.
7
___ 13. It takes a lot of luck to be an outstanding employee on most jobs.
___ 1. A job is what you make of it.
___ 14. People who perform their jobs well generally get
rewarded for it.
___ 2. On most jobs, people can pretty much accomplish whatever they set out to accomplish.
___ 15. Most employees have more influence on their supervisors than they think they do.
___ 3. If you know what you want out of a job, you can
find a job that gives it to you.
___ 16. The main difference between people who make
a lot of money and people who make a little
money is luck.
___ 4. If employees are unhappy with a decision made
by their boss, they should do something about it.
___ 5.
Getting the job you want is mostly a matter of luck.
___ 6. Making money is primarily a matter of good
fortune.
___ 7. Most people are capable of doing their jobs well
if they make the effort.
___ 8. In order to get a really good job, you need to
have family members or friends in high places.
___ 9. Promotions are usually a matter of good fortune.
Scoring: First recalculate your responses to items 1, 2, 3,
4, 7, 11, 14, and 15 by subtracting the number you wrote
from 7. (6 = 1; 5 = 2; 4 = 3; 3 = 4; 2 = 5; 1 = 6). Cross
out the number you initially wrote and replace it with the
recoded value; only the new values will be used in scoring. Now add up your scores to all sixteen items to get
your work locus of control score.
Interpretation: Higher scores reflect a more external
locus of control. Managers tend to have a more internal
locus of control.36 If your score is not as low as you would
like, review the questions and try to find ways to view
yourself as being more in control of what happens to you.
Source: Copyright Paul E. Spector, All rights reserved, 1988.
appropriate within hierarchical social systems such as organizations. 37 For
example, a person who is highly authoritarian may accept directives or orders
from someone with more authority purely because the other person is “the
boss.” On the other hand, a person who is not highly authoritarian, although
she or he may still carry out reasonable directives from the boss, is more likely
to question things, express disagreement with the boss, and even refuse to
carry out orders if they are for some reason objectionable. During the aftermath of the Enron and Arthur Anderson scandals that destroyed both firms,
charges were brought against some accountants who shredded important documents before they could be seized by the authorities. The defense these individuals used w as that they were simply following orders . To the extent a
person engages in these kinds of behaviors knowing they are wrong but does
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
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CHAPTER 3 | Individual Characteristics
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PART 2 | Individual Behaviors and Processes in Organizations
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Authoritarianism is the extent to which a person believes
that power and status differences within organizations are
appropriate. This individual is listening closely to instructions
from his boss and seems intent on following those instructions.
A person lower on authoritarianism might not be as receptive
to direction.
so anyway in order to follow orders would suggest
that the person is highly authoritarian.
Machiavellianism
STUART
Machiavellianism is another important personality
trait. This concept is named after Niccolo Machiavelli, a
sixteenth-century author. In his book The Prince,
Machiavelli explained how the nobility could more­easily
gain and use power. The term “Machiavellianism” is now
used to describe behavior directed at gaining power and
controlling the behavior of others. Research suggests that the degree of Machiavellianism varies from person to person. More Machiavellian individuals tend to
be rational and unemotional, may be willing to lie to attain their personal goals,
put little emphasis on loyalty and friendship , and enjoy manipulating others’
behavior. Less Machiavellian individuals are more emotional, less willing to lie
to succeed, value loyalty and friendship highly, and get little personal pleasure
from manipulating others. By all accounts, Dennis Kozlowski, the indicted former CEO of Tyco International, had a high degree of Mac hiavellianism. He
apparently came to believe that his position of power in the company ga ve him
the right to do just about anything he wanted with company resources.38
Machiavellianism
A trait causing a person
to behave in ways to gain
power and control the
behavior of others
Tolerance for Risk and Ambiguity
tolerance for risk (or risk
propensity)
The degree to which a
person is comfortable
with risk and is willing to
take chances and make
risky decisions
tolerance for ambiguity
Reflects the tendency
to view ambiguous
situations as either
threatening or desirable
Two other closely related traits are tolerance for risk and tolerance for ambiguity.
Tolerance for risk (also called risk propensity) is the degree to which a person
is comfortable accepting risk, willing to take chances and to make risky decisions.
A manager with a high tolerance for risk, for example, might experiment with
new ideas and gamble on new products. Such a manager might also lead the organization in new and different directions . This manager might be a catalyst for
innovation or, if the risky decisions prove to be bad ones, might jeopardize the
continued well-being of the organization. A manager with low tolerance for risk
might lead an organization to stagnation and excessive conservatism, or might
help the organization successfully weather turbulent and unpredictable times by
maintaining stability and calm. Thus, the potential consequences of a manager’s
risk propensity depend heavily on the organization’s environment.
Tolerance for ambiguity reflects the tendency to view ambiguous situations as either threatening or desirable.39 Intolerance for ambiguity reflects a
tendency to perceive or interpret vague, incomplete, or fragmented information or information with multiple, inconsistent, or contradictory meanings as
an actual or potential source of psyc hological discomfort or threat. 40 Being
­tolerant of ambiguity is related to creativity, positive attitudes toward risk,
and orientation to diversity.41 Managers with a low tolerance for ambiguity
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CHAPTER 3 | Individual Characteristics
101
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A Type B personality describes someone who is
relaxed easygoing, and less overtly competitive.
This manager seems to be calm and relaxed as she
completes a project. While we can’t be certain, it
would appear likely that she has a Type B personality.
Type A and B traits
MICHA
tend to be more directive with their staff
and do not empower them to make their
own decisions at work. The best managerial strategy is to place individuals
with a low tolera nce for ambiguit y in
well-defined and regulated tasks.
Two cardiologists identified a pair of
different personality profiles they
called Type A and Type B. The Type A
­p ersonality is impatient, competitive,
ambitious, and uptight. The Type B personality is more relaxed and easygoing and less overtly competitive than Type A. Type Bs are not without
stress, but they confront c­ hallenges and external threats less frantically.
Unlike Type As, Type Bs rarely experience a frustrated sense of wasting time
when not actively engaged in productive activity. 42 Although Type As often
have higher job performance than Type Bs,43 Type As are also more prone to
stress and coronary heart disease. Although the idea that a cause-and-effect
relationship exists between Type A behavior and coronary artery disease is
controversial, some effects of Type A stress are definitely known. Stress
causes an increase in blood pressure; if the stress is constant, the heart and
arteries begin to show signs of damage. It has been ­estimated that 14 to 18
percent of sudden heart attacks occur immediately after an emotional stress
and are more likely to occur when a person is angry.44 However, as shown in
Figure 3.2, Type A and B profiles reflect extremes with most people simply
tending toward one or the other.
Type A personality
Impatient, competitive,
ambitious, and uptight
Type B personality
More relaxed and
easygoing and less overtly
competitive than Type A
Figure 3.2
Type A
Type B
• More competitive
• More devoted to
work
• Stronger sense
of time urgency
• Less competitive
• Less devoted to
work
• Weaker sense
of time urgency
Few people have
extreme Type A or Type
B personality profiles.
Instead, people tend
toward one type or the
other. This is reflected by
the overlap between the
profiles shown here.
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102
PART 2 | Individual Behaviors and Processes in Organizations
Understanding the personality type of your coworkers and boss can help
you to better understand and manage this potential source of work conflicts .
Recognizing your personality type can help you to identify work situations
that are good fits for you. High Type As need greater stimulation than Type Bs
and are more likely to overschedule themselves. In managers, having a high
Type A personality and an external locus of control is associated with greater
levels of perceived stress, lower job satisfaction, and poorer physical and mental health compared to those with a Type B personality and an internal locus
of control. Some researchers have even suggested that negative health consequences may outweigh the superficial attractiveness of the Type A personality
in a managerial position.45
The Bullying Personality
workplace bullying
Repeated mistreatment
of another employee
through verbal
abuse; conduct that is
threatening, humiliating,
or intimidating; or
sabotage that interferes
with the other person’s
work
Workplace bullying is a repeated mistreatment of another employee
through verbal abuse; conduct that is threatening, humiliating, or intimidating; or sabotage that interferes with the other person’ s work.46 Popular
media such as Time, Management Today, and Psychology Today have all
featured stories on the pervasiveness of bullying. Bullying costs employers
through higher turnover, greater absenteeism, higher workers’ compensation costs, and higher disability insurance rates , not to mention a dimin ished reputation as a desirable place to work. 47 Fifty percent of the U.S.
workforce reports either being bullied at work (35 percent) or witnessing
bullying (15 percent). It is four times more common than harassment.
Eighty-one percent of bullying behavior is done by supervisors.48 Forty-five
percent of targets report stress-related health problems; targeted individuals suffer debilitating anxiety, panic attacks, clinical depression, and even
post-traumatic stress. Once targeted, employees have a 64 percent chance
of losing their job for no reason. Despite this, 40 percent of targets never
report it. Only 3 percent sue and 4 percent complain to state or federal
agencies.49
Who tends to become a bully? Bullying is complex and comes in a variety
of forms, but common to all types is the abuse of authority and power, stemming from the bully’s need to control another person. Machiavellianism may
lead to bullying. High Machiavellians exhibit a resistance to social influence,
an orientation to cognitions (rational thoughts) rather than emotions , and a
tendency toward initiating and controlling structure (components of bossi ness). High Machiavellians manipulate and exploit others to advance their
personal agendas, which is the foundation of bullying. If personality helps to
explain why some people are bullies, can it also help us understand why
some people are more likely to be targets of bullying? Although there is no
clear personality profile that predicts who will be targeted, people who are
more introverted, less agreeable, less conscientious, less open to experience,
and more emotionally unstable seem to be more likely to be bullied. 50 This
chapter’s Improve Your Skills feature describes ways managers can be bullies (or just toxic), and describes various survival tactics (that we hope you’ll
never have to use!).
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103
IMPROVE YOUR SKILLS
CHALLENGING MANAGERIAL BEHAVIORS AND HOW TO RESPOND
TYPES OF NARCISSISTIC MANAGERS
Subordinate
Survival Tactics
Superior’s Actions
Be admired
Show admiration; avoid
criticizing them; consult
with mentor or executive
coach
Close oversight of
managers is needed to
continually assess their
treatment of others
Grandiose self-image; exploits
others out of carelessness; is
inconsiderate in treatment of
others due to not receiving
negative feedback for behavior
Be admired
Show admiration; avoid
criticizing them; consult
with mentor or executive
coach
Do not automatically
believe superiors over
subordinates
Control Freak
Micromanages; seeks absolute
control of everything; inflated
self-image and devaluation of
others’ abilities; fears chaos
Control
others
Avoid direct
suggestions; let them
think new ideas are
their own; don’t
criticize them; show
admiration and
respect; don’t outshine
them; play down your
accomplishments and
ambition; document
your work; build
relationship with a
mentor; look for other
positions
360-degree feedback;
place them where
they cannot do serious
harm; consider getting
rid of them; don’t
ignore signs of trouble
Antisocial
Takes what he or she wants; lies
to get ahead and hurts others if
they are in his or her way; lacks
both a conscience and capacity
for empathy
Excitement
of violating
rules and
abusing
others
Avoid provoking them;
transfer out before
they destroy you; do
not get dragged into
their unethical or illegal
activities; seek allies in
coworkers and mentors;
seek executive coach to
help you cope
Consider possible
presence of
depression, anxiety,
alcohol
Varieties
Primary Traits
Objective
Grandiose:
Psychodynamic
Outward grandiose self-image;
exploits others; devalues
others; enraged if self-esteem
threatened; limited conscience
and capacity for empathy;
desperately protects underlying
fragile self-esteem
Grandiose:
Learned
Source: From Lubit, R. (2004, March/April). The Tyranny of Toxic Managers: Applying Emotional Intelligence to Deal with Difficult
Personalities. Ivey Business Journal, p. 4.
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CHAPTER 3 | Individual Characteristics
104
PART 2 | Individual Behaviors and Processes in Organizations
Role of the Situation
GLOBAL
BALDYRGAN/SHUTTERSTOCK.COM
The relationship between personality and beha vior changes depending on
the strength of the situation we are in. We might be extroverted in nature
but, in a situation like a lecture or an important meeting , suppress our tendencies and behave in a more quiet and reserved way. When situational pressures are weak, we are better able to be ourselves and let our personalities
guide our behaviors. Strong organizational cultures might decrease the
influence of personality on employee behaviors by creating clear guidelines
for employee behavior. Weaker organizational cultures might allow greater
individual employee expression, resulting in a wider variety of employee
behaviors.
You now have a good understanding of some of the ways we all differ. It is
also interesting to think about how frequently there are differences in how
people from other cultures perceive us . Asking foreigners to describe people
from your country is a powerful way to understand how others perceive you.
This chapter’s Global Issues feature is from a Newsweek survey reporting the
characteristics foreigners most and least often associate with Americans. It
may give you some insight into how an American might be perceived differently in different parts of the world.
ISSUES
HOW OTHERS SEE AMERICANS
Characteristics Most Commonly Associated with Americans
France
Japan
Western
Germany
Great Britain
Brazil
Mexico
Industrious
Nationalistic
Energetic
Friendly
Intelligent
Industrious
Energetic
Friendly
Inventive
Self-indulgent
Inventive
Intelligent
Inventive
Decisive
Friendly
Energetic
Energetic
Inventive
Decisive
Rude
Sophisticated
Industrious
Industrious
Decisive
Friendly
Self-indulgent
Intelligent
Nationalistic
Nationalistic
Greedy
Characteristics Least Commonly Associated with Americans
France
Japan
Western
Germany
Great Britain
Brazil
Mexico
Lazy
Industrious
Lazy
Lazy
Lazy
Lazy
Rude
Lazy
Sexy
Sophisticated
Self-indulgent
Honest
Honest
Honest
Greedy
Sexy
Sexy
Rude
Sophisticated
Sexy
Rude
Decisive
Sophisticated
Sexy
Source: Adler, N. J. (2008). International Dimensions of Organizational Behavior. Mason, OH: Thompson/South-Western, p. 82, Table 3-1.
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CHAPTER 3 | Individual Characteristics
105
INTELLIGENCE
In addition to personality and personality traits , another important set of
individual differences is intelligence. There are many types of intelligence, or
mental abilities, including general mental ability, information processing
capacity, verbal ability, and emotional intelligence.
General Mental Ability
General mental ability is the capacity to rapidly and fluidly acquire, ­process,
and apply information. It involves reasoning, remembering, understanding,
and problem solving. It is associated with the increased ability to acquire, process, and synthesize information and has been defined simply as the ability to
learn.51 The strong association between measures of general mental ability
and performance in a wide variety of task domains is one of the most consis tent findings in the field of organizational behavior.52 Research has supported
the idea that mental ability is most important in complex jobs, when individuals are new to the job , and when there are c hanges in the workplace that
require workers to learn new ways of performing their jobs.53 Some companies,
including Google , prefer to hire for general mental ability rather than
experience.54
Information processing capacity involves the manner in whic h
­individuals process and organize information. Information processing capacity
also helps explain differences between experts and novices on task learning
and performance, as experts process and organize information more efficiently
and accurately than novices.55 General mental ability influences information
processing capacity.56 Age also explains differences in information processing
capacity. Relative to younger adults, older adults tend to have access to a wider
amount and variety of information, although they are less able to process
novel information quickly.57
Mental ability tests typically use computerized or paper -and-pencil test
formats to assess general mental abilities, including verbal or mathematical
reasoning, logic, and perceptual abilities. Because scores on these tests can
predict a person’s ability to learn in training or on the job ,58 be adaptable and
solve problems, and tolerate routine, their predictive value may increase given
the trend toward jobs requiring innovation, continual training, and nonroutine problem solving. There are many different types of mental ability tests ,
including the Wonderlic Personnel Test, Raven’s Progressive Matrices, the
Kaufman Brief Intelligence Test, and the Wechsler Abbreviated Scale of Intelligence. Table 3.3 presents example items similar to those incorporated into
the Wonderlic test.
Despite being easy to use and one of the most valid selection methods for
all jobs, mental ability tests produce racial differences that are three to five
times larger than other methods that are also valid predictors of job performance such as structured interviews.59 Although the reasons for the different
results are not fully understood, it is thought that factors including culture,
differential access to test coaching and test preparation programs, and different test motivation levels could be important factors .60 Job applicants also
often dislike mental ability tests because they do not necessarily seem to be
job related.61
general mental ability
The capacity to rapidly
and fluidly acquire,
process, and apply
information
information processing
capacity
Involves the manner in
which individuals process
and organize information
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106
PART 2 | Individual Behaviors and Processes in Organizations
Table 3.3
Mental Ability Test Items
The following questions are similar to those found on the Wonderlic Personnel Test
measuring mental ability. The answers are at the bottom of the table.
1. Assume the first two statements are true. Is the final one (1) true (2) false or (3) not
certain?
• The girl plays soccer.
•
All soccer players wear cleats.
•
The girl wears cleats.
2.
Paper sells for $0.36 per pad. What will three pads cost?
3.
How many of the five pairs of items listed below are exact duplicates?
Pullman, K. M.
Puilman, K. M.
Jeffrey, C. K.
Jeffrey, C. K.
Schoeft, J. P.
Shoeft, J. P.
Lima, L. R.
Lima, L. R.
Woerner, K. E.
Woerner, K. C.
4.
PRESENT PRESERVE—Do these words
1. Have similar meanings?
2.
Have contradictory meanings?
3.
Mean neither the same nor the opposite?
Answers: (1) true; (2) $1.08; (3) 1; (4) 2.
Because hiring discrimination can be legally problematic when using
mental ability tests,62 it is best to evaluate the effect of mental ability tests
on protected groups before using them on job candidates . Because mental
ability tests can be combined with other predictors to reduce adverse impact
and increase prediction accuracy, and because alternative predictors with
less adverse impact can be used to predict job success comparably to mental
ability tests used alone, generally mental ability tests should not be used
alone.63 Many organizations use mental ability tests, including the National
Football League.64
Multiple Intelligences
multiple intelligences
Suggests that there are a
number of distinct forms
of intelligence that each
individual possesses in
varying degrees
Intelligence tests often involve a range of abstract questions designed to assess
your language, spatial awareness, and numerical ability. However, to think
that your score on a single test reflects your actual intelligence ignores your
many other mental abilities. A lower score on a particular intelligence test
result simply means you are less skilled at whatever type of intelligence that
particular test measures—while reflecting nothing about your level of any
other type of intelligence.
Increasingly, researchers and scholars are realizing that there is more
than one w ay to be smart. 65 Gardner’s theory of multiple intelligences
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CHAPTER 3 | Individual Characteristics
107
suggests that there are a number of distinct forms of intelligence that eac h
individual possesses in varying degrees:66
1. Linguistic: words and language
2. Logical-mathematical: logic and numbers
3. Musical: music, rhythm, and sound
4. Bodily-kinesthetic: body movement and control
5. Spatial-visual: images and space
6. Interpersonal: other people’s feelings
7. Intrapersonal: self-awareness
The different intelligences represent not only different content domains
but also learning preferences. The theory suggests that assessment of abilities should measure all forms of intelligence, not just linguistic and logicalmathematical, as is commonly done (e.g., in college admissions tests like the
ACT, SAT, GMAT, and GRE). 67 According to this theory, learning and teaching should focus on the particular intelligences of eac h person. For example,
if you have strong spatial or linguistic intelligences, you should be encouraged to develop these abilities .68 The theory also emphasizes the cultural
context of multiple intelligences. For instance, Gardner observed that the
needs of different cultures lead them to emphasize different types of intelli gence. For example, the high spatial abilities of the Puluwat people of the
Caroline Islands enable them to navigate their ocean canoes, and a balance
of personal intelligences is required in Japanese society.69
Knowing your strongest areas of intelligence can guide you to the most
appropriate job and learning environments to enable you to ac hieve your
potential. For example, compare your intelligence strengths to the job types
in Table 3.4. As a manager, it is possible to develop the same skills in differ ent ways for different subordinates. For example in diversity training, bodilykinesthetic learners could engage in role-pla ys while spatial-visual
subordinates could create posters conveying the material being taught.
Using a person’s preferred learning style helps to make learning easy and
enjoyable.
Emotional Intelligence
Emotional intelligence (EI) is an interpersonal capability that includes the
ability to perceive and express emotions, to understand and use them, and to
manage emotions in oneself and other people .70 Expert Daniel Goleman
defines emotional intelligence as “the capacity for recognizing our own feel ings and those of others, for motivating ourselves, and for managing emotions
well in ourselves and in our relationships.”71 He describes five dimensions of
EI that include three personal competencies (self-awareness, self-regulation,
and motivation) and two social competencies (empathy and social skills). Emotional capabilities may operate at multiple levels to influence change in organizations. 72 EI ma y also influence employee emotional reactions to job
insecurity and their coping with associated stresses.73 Emotional intelligence
involves using emotional regulatory processes to control anxiety and other
negative emotional reactions and to generate positive emotional reactions .74
emotional intelligence (EI)
An interpersonal
capability that includes
the ability to perceive
and express emotions, to
understand and use them,
and to manage emotions
in oneself and other
people
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108
PART 2 | Individual Behaviors and Processes in Organizations
Table 3.4
Matching Intelligence Types with Career Choices
Type of Intelligence
Related Careers
Preferred Learning
Style
Bodily-Kinesthetic:physical agility
and balance; body control; hand-eye
coordination
Athletes, firefighters, chefs, actors,
gardeners
Touch and feel, physical
experience
Interpersonal: ability to relate to others and
perceive their feelings; interprets behaviors of
others; relates to emotional intelligence
Psychologists, doctors, educators,
salespeople, politicians
Human contact, teamwork
Intrapersonal: self-awareness; understands
oneself and one’s relationship to others
and to the world; relates to emotional
intelligence
Related to success in almost all
careers
Self-reflection, self-discovery
Linguistic:verbal and written language;
explaining and interpreting ideas and
information
Authors, speakers, lawyers, TV and
radio hosts, translators
Verbal and written words
and language
Logical-Mathematical: logic and pattern
detection; analytical; problem solving;
excels at math
Engineers, directors, scientists,
researchers, accountants,
statisticians
Logic and numbers
Musical:recognition of rhythm and tonal
patterns; musical ability; high awareness
and use of sound
Musicians, DJs, music teachers,
acoustic engineers, music
producers, composers
Music, sounds, rhythm
Spatial-Visual: creation and interpretation
of visual images; visual and special
perception
Artists, engineers, photographers,
inventors, beauty consultants
Pictures, shapes, visually
Source: Based on Gardner, H. (1983). Frames of Mind. New York: Basic Books; Gardner, H. (1993a). Multiple Intelligences: The Theory in Practice.
NY: Basic Books; Gardner, H. (1993b). Creating Minds. NY: Basic Books; Marks-Tarlow, T. (1995). Creativity Inside Out: Learning Through Multiple
Intelligences. Reading, MA: Addison-Wesley.
Negative emotions, such as anxiety or frustration, are distracting and result
in diminished learning and performance.75 Emotional regulation and control
may also be important in managing distracting positive emotions at work. The
five dimensions comprising emotional intelligence are:
1. Self-awareness: being aware of what you are feeling
2. Self-motivation: persisting in the face of obstacles, setbacks, and failures
3. Self-management: managing your own emotions and impulses
4. Empathy: sensing how others are feeling
5. Social skills: effectively handling the emotions of others
People differ in the degree to which they are able to recognize the emotional
meaning of others’ facial expressions, although seven universal emotions are
expressed in the face in exactly the same way regardless of race, culture, ethnicity, age, gender, or religion. 76 These emotions are joy, sadness, fear, surprise,
anger, contempt, and disgust. Recognizing and understanding these emotions is
important in communicating, establishing relationships, building rapport, negotiating, and many other managerial tasks. More effective communicators better
recognize the emotions being conveyed by peoples’ facial expressions.77
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CHAPTER 3 | Individual Characteristics
CASE STUDY
109
Emotional Intelligence at FedEx
Global shipping company FedEx has a “people
first” philosophy and believes that for the company to deliver world class customer service its
managers must also have an attitude of service in
managing their associates. FedEx has received
numerous awards for being one of the world’s
most respected and admired companies for over
ten years,78 and is one of the world’s most successful businesses. Although the company is
focused on speed and logistics, from the start it
recognized that its employees were the key to the
company’s success, and that leadership would be
essential to effective management. 79 Fit with a
service-oriented culture is taken so seriously that
one of FedEx’s core managerial values is to be a
servant leader.80
FedEx recognizes that leadership has grown
more complex, and wants to develop leadership
capabilities in its managers to manage its changing workforce. The company wants leaders who
make fast and accurate decisions, are able to
influence others and motivate them to give their
full effort, and who can help build a culture where
employees drive for exceptional performance in a
sustainable way that creates value for all of its
stakeholders.81 Jimmy Daniel, senior leadership
facilitator at the FedEx Global Leadership Institute,
said, “Some leaders have an innate ability to provide what’s needed to create a satisfying and
rewarding work environment for employees, but
many others need to develop this skill set.”82 To
measure leadership performance, FedEx administers an annual survey where all employees can
provide feedback about their managers. The survey’s themes include fairness, respect, listening,
and trust. A recognition that all of these characteristics are related to relationships and emotions
created an interest in emotional intelligence as a
learnable skillset that would enhance managers’
ability to lead in the FedEx way.83
FedEx decided to increase its focus on emotional intelligence in its leadership development
training to give all new managers a strong people-first foundation on which to build their managerial careers. To build teams in which employees
give their full effort, FedEx believes that task-based
management is insufficient and leaders need to
manage their own emotions and behaviors to
effectively serve as role models, mentors, and
motivators at an emotional level. 84 A five-day
course and six-month follow up coaching process
was developed to identify new managers’
strengths and give them specific emotional intelligence competencies to improve on.
The emotional intelligence training and coaching program focused on showing managers how
to manage themselves first and take charge of
their own emotions and behaviors so that they can
be effective influencers and role models. The
majority of leaders showed large improvements in
relationships, influence, and decision making as a
result of their improved empathy, emotional literacy, and ability to navigate emotions. 85 FedEx
has been extremely pleased with the success of
the emotional intelligence development program,
training over 100 facilitators to run the program
and coach new leaders worldwide.86
Questions:
1. Do you think that emotional intelligence would
be important for a manager at FedEx to have?
Explain your answer.
2. How does FedEx develop its new leaders’
emotional intelligence?
3. What else do you think that FedEx can do to
enhance its managers’ emotional intelligence?
There is some evidence that components of EI are malleable skills that
can be developed, including facial expression recognition. 87 The ability to
understand what others think and feel, knowing how to appropriately per suade and motivate them, and knowing how to resolve conflicts and forge
cooperation are some of the most important skills of successful managers. You
can get a rough estimate of your EI by taking the EI self-assessment from
About.com at http://psychology.about.com/library/quiz/bl_eq_quiz.htm.
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PART 2 | Individual Behaviors and Processes in Organizations
There is also controversy associated with the concepts of EI. 88 Some have
argued that its theoretical conceptualization is unc lear because it is overly
inclusive, lacks specificity, and encompasses both static trait components and
malleable state components. It is not clear if it is simply a learned skill or an
innate capability. Several researchers have also argued that EI is simply a surrogate for general intelligence and well-established personality traits.89 However, a number of studies have supported the usefulness of EI.90 EI has been
found to be related to, and yet distinct from, personality dimensions; and various measures of EI provided incremental predictive power regarding life satis faction and job performance , even after controlling for Big F ive personality
dimensions.91 It appears that, although controversies still exist, EI is distinct
from other ability and personality trait measures . There is some ambiguity
about the degree to which EI is considered a malleable and trainable set of competencies versus a stable set of personality traits or emotional abilities; however, EI does relate to job performance, adjustments to stressful situations, and
pro-social behaviors. This chapter’s Case Study explores how FedEx incorporated emotional intelligence into its new leader training program.
LEARNING STYLES
learning style
Refers to individual
differences and
preferences in how we
process information
when problem solving,
learning, or engaging in
similar activities
The final individual difference we will address in this c hapter is learning style.
Learning style refers to individual differences and preferences in how we pro cess information when problem solving, learning, or engaging in similar activities.92
There are numerous typologies, measures, and models that capture these differences and preferences. Most of these approaches have focused on child learning,
but there is evidence that these differences are important for adults as well. 93
Next we’ll discuss several of the most popular approaches to learning styles.
Sensory Modalities
One approach addresses our preference for sensory modality. A sensory modality is a system that interacts with the environment through one of the basic
senses.94 The most important sensory modalities are:
•
•
•
•
Visual: learning by seeing
Auditory: learning by hearing
Tactile: learning by touching
Kinesthetic: learning by doing
According to researchers, about 20 to 30 percent of American students are
auditory; about 40 percent are visual; and the remaining 30 to 40 percent are
either tactile/kinesthetic, visual/tactile, or some combinations of the above
major senses.95
Learning Style Inventory
A second approach to understanding learning styles, the Kolb Learning Style
Inventory, is one of the more dominant approac hes to categorizing cognitive
styles.96 According to David Kolb, the four basic learning modes are active
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CHAPTER 3 | Individual Characteristics
experimentation, reflective observation, concrete experience, and abstract conceptualization. In addition, the learning process is considered from the two
dimensions of active/passive and concrete/abstract. 97 Kolb suggests that there
are four basic learning styles:98
1. Convergers: depend primarily on active experimentation and abstract
conceptualization to learn. People with this style are superior in technical
tasks and problems and inferior in interpersonal learning settings.
2. Divergers: depend primarily on concrete experience and reflective obser vation. People with this style tend to organize concrete situations from
different perspectives and structure their relationships into a meaningful
whole. They are superior in generating alternative hypotheses and ideas,
and tend to be imaginative and people or feeling-oriented.
3. Assimilators: depend on abstract conceptualization and reflective observation. These individuals tend to be more concerned about abstract concepts
and ideas than about people. They also tend to focus on the logical soundness and preciseness of ideas, rather than the ideas’ practical values; they
tend to work in research and planning units.
4. Accommodators: rely mainly on active experimentation and concrete experience, and focus on risk taking, opportunity seeking, and action. Accommodators tend to deal with people easily and specialize in action-oriented
jobs, such as marketing and sales.
Although much has been written about cognitive styles , there are wide
gaps in our current understanding. There are many differences in how styles
are conceptualized,99 and there have been numerous criticisms of Kolb’s measures and the underlying theory.100 These measures are subject to a variety of
statistical and inferential problems, and many show low reliability.101 Most of
the research has also focused on children—less work has focused on how the
styles influence adult learning. Despite these limitations, evidence suggests
that cognitive and learning styles may be important for understanding human
behavior and performance in a variety of contexts.
Learning Style Orientations
Finally, Annette Towler and Robert Dipboye 102 developed a learning style
orientation measure to address some of the limitations of the K olb inventory and identify key styles and preferences for learning . They demonstrated that learning style orientations predict preferences for instructional
methods beyond the Big F ive personality traits. They identified five key
factors:
1. Discovery learning: an inclination for exploration during learning. Discovery learners prefer subjective assessments, interactional activities, informational methods, and active-reflective activities.
2. Experiential learning: a desire for hands-on approac hes to instruction.
Experiential learning is positively related to a preference for action
activities.
3. Observational learning: a preference for external stimuli such as demonstrations and diagrams to help facilitate learning. Observational learning
is positively related to preference for informational methods and activereflective methods.
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111
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PART 2 | Individual Behaviors and Processes in Organizations
4. Structured learning: a preference for processing strategies such as taking
notes, writing down task steps, and so forth. Structured learning is related
to preferences for subjective assessments.
5. Group le arning: a pr eference t o w ork w ith o thers w hile l earning.
Group learning is related to preferences for action and interactional
learning.
SUMMARY AND APPLICATION
Understanding individuals in organizations is important for all managers .
A basic framework for facilitating this understanding is the psychological contract—people’s expectations regarding what they will contribute to the organization and what they will get in return. Organizations strive to ac hieve an
optimal person-job fit, but this process is complicated by the existence of indi vidual differences.
Personalities are the relatively stable sets of psychological and behavioral
attributes that distinguish one person from another. The Big Five personality
traits are agreeableness, conscientiousness, neuroticism, extraversion, and
openness. Myers-Briggs dimensions and emotional intelligence also offer
insights into personalities in organizations. Other important traits are locus of
control, self-efficacy, self-esteem, authoritarianism, Machiavellianism, tolerance for risk and ambiguity, Type A and Type B traits, and tendencies to bully.
The role of the situation is also important. Learning styles, or individual differences and preferences in how we process information when problem solv ing, learning, or engaging in similar activities, are also important individual
differences and preferences, and there are numerous typologies , measures,
and models that capture them. (In Chapter 5 we will discuss learning from a
different perspective—the role of learning in work motivation.)
Everyone is different. We each have different personalities, demographics, and intelligences. By understanding the characteristics of your coworkers, managers, and subordinates, you will be best able to c hoose the OB tool
or management style that will be most effective. Remember, flexibility is the
key to effective management. We next continue our discussion of other
important individual differences that affect organizational behavior in Chapter 4. Among the major topics we will cover in that chapter are attitudes,
values, emotions, perception, and stress.
DISCUSSION QUESTIONS
1. What is a psychological contract? Why is it important? What psychological
contracts do you currently have?
2. What individual differences do you feel are most important to organiza tions? Why?
3. If you were denied a job because of your score on a personality test, what
would be your reaction?
4. If your supervisor exhibited bullying behaviors, what would you do?
5. Which of Gardner’s multiple intelligences do you feel are most important
for managers?
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113
REA L W O R LD R E S PO N S E
INDIVIDUAL DIFFERENCES THAT MAKE A
DIFFERENCE AT SOUTHWEST AIRLINES
Southwest Airlines looks for employees with positive
speaker. Unselfish people who enthusiastically support
attitudes and leadership skills, who fit well with the
their potential coworkers are the ones who catch South-
company’s fun and unique culture. Their investment
west’s eye, not the applicants who seem bored or use
of time and resources in finding the right talent has
the time solely to improve their own presentations.106
paid off in lower turnover, increased internal promotion rates, and higher productivity.103
Prospective employees are often asked during an
interview how they recently used their sense of humor
Instead of evaluating flight attendant candidates on
in a work environment and how they have used humor
a fixed set of skills, Southwest looks for their attitude
to defuse a difficult situation. Southwest also looks for
toward others, work ethic, and their ability to work
humor in the interactions people have with each other
effectively on a team.104 Flight attendant candidates
during group interviews. 107 To assess leadership,
do more than interview for a job, they audition—and
Southwest Airlines uses a group assessment exercise
the audition begins the moment they request an appli-
called Fallout Shelter, in which candidates imagine
cation. Managers jot down anything memorable about
they are a committee charged with rebuilding civiliza-
the initial conversation, both good and bad. When fly-
tion after a nuclear war. Groups are given a list of fif-
ing candidates out for interviews, their special tickets
teen people from different occupations, including nurse,
alert gate agents, flight attendants, and others to pay
teacher, all-sport athlete, biochemist, and pop singer,
special attention to them. Employees observe whether
and have ten minutes to make a unanimous decision
recruits are consistently friendly to the crew and to
about which seven people can remain in the only avail-
other passengers or if they are complaining and drink-
able fallout shelter. Each candidate is graded on a
ing cocktails at 9 a.m., and they pass these observa-
scale ranging from “passive” to “active” to “leader” as
tions on to the People Department.105
they propose, discuss, and debate the decision.108
Flight attendant recruits are evaluated even when
Southwest consistently has the highest productiv-
they think that they are not being assessed. During the
ity numbers in the industry. 109 Southwest’s hiring
five-minute speeches flight attendant job candidates must
methods not only ensure that it hires people whose
give about themselves in front of as many as fifty other
personalities fit the company’s culture, but also help
recruits, managers watch the audience as closely as the
the company execute its customer service strategy.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
LOSKUTNIKOV/SHUTTERSTOCK.COM
CHAPTER 3 | Individual Characteristics
114
PART 2 | Individual Behaviors and Processes in Organizations
6. Do you think emotional intelligence is important to managers? How would
you assess emotional intelligence in deciding who to promote to a managerial position?
7. If you were a manager, what individual differences would be important to
you in hiring an assistant? Why?
UNDERSTAND YOURSELF EXERCISE
Work Locus of Control
This chapter’s Understand Yourself feature gave you the chance to self-assess
your work locus of control. Higher scores on the measure reflect a more external locus of control. Managers tend to have a more internal locus of control.
After completing the self-assessment, answer the following questions:
1. Do you think that your score accurately reflects your locus of control
at work? Why or why not?
2. How do you think that work locus of control might influence your ef fectiveness as a manager?
3. What do you think is the ideal locus of control in a work setting and why?
4. What might you do in the next year to make your work locus of control
consistent with your answer to number 3?
GROUP EXERCISE
Strengths-Based Development
When drought threatened the survival of Ohio farming co-op Auglaize Provico,
CEO Larry Hammond realized that he would ha ve to change the business
model. Grain elevators were sold, headcount was carefully reduced 25 percent,
and the co-op took on work outside of its previous core business. Hammond
even cut his own pay.
Hammond then implemented strengths-based development to leverage the
unique strengths and talents of each employee. The strengths approach recognizes that everyone has different talents and natural patterns of thought, feeling, and behavior. Recognizing and building on those talents with pertinent
skills and knowledge creates strengths. People who are applying a true strength
tend to perform well. Hammond hoped that encouraging employees to leverage
their innate talents would enable them to drive the business forward.
Auglaize’s management had previously used a “deficit” development
approach, spending a lot of time identifying employees’ weaknesses and trying
to correct them. This meant that a lot of Auglaize’s management was relatively
negative. Hammond wanted to change that approach. He says, “If you really
want to [excel], you have to know yourself—you have to know what you’re good
at, and you have to know what you’re not so good at, and a lot of people don’t.
Most of us know what we’re not good at because people tell us. And we also tend
to want to fix it.” The idea that workers should “fix” their weaknesses is common, but it can be problematic because attempts to fix weaknesses take time ,
attention, and energy a way from maximizing naturally powerful talents .
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 3 | Individual Characteristics
Employees also enjoy using their talents and doing something well instead of
struggling against their weaknesses to produce mediocre work.
Every employee in the co-op took an assessment to measure and identify his
or her top five talents, and received at least two consultations on their individual
strengths. This enabled Auglaize to build on what its employees naturally do best.
Employees became more engaged, productive, and energized, and the organization became more successful. As one expert says, “One issue is that the people who
are really valued often don’t know who they are, especially in times of change. If
managers regularly give positive feedback to key performers, it increases their
confidence to undertake greater challenges and reinforces their commitment.”
Questions:
1. Do you think it is better to focus on assessing and developing employ ees’ weaknesses, or to focus on their strengths? Why?
2. Why would strengths-based development increase employee
engagement?
3. If you were a manager, how might you interact with employees differently if you were using strengths-based development rather than deficit-based development?
Source: Robison, J. (2007). Great Leadership Under Fire. Gallup Management Journal. Available online at: http://gmj.gallup.com/content/26569/Great-Leadership-Under-Fire.aspx; Local Ag
­Companies Merge to Form New Cooperative. Sidney Daily News, February 20, 2008, 8; Zelm, A.
(2008). Farm Firm Poised for Expansion. The Evening Leader. March 10, page A1.
VIDEO EXERCISE
Barcelona Restaurant Group is always trying to attract and retain only those
employees who reinforce its service-oriented culture and provide top quality
customer service. The manager being interviewed in the video is constantly
recruiting and hiring new employees and letting low performers and poor fits
go. He also tries to provide job candidates with a realistic description of the
company’s expectations to ensure that they know what they would be getting
into if they took a job with the company.
As a class, watch “Barcelona” (6:04) and then individually consider the following questions. After you have come up with your own ideas, form groups of
4-5 people and discuss your insights. Be sure to nominate someone to serve as
a spokesperson to share your ideas with the class.
1. How does the Barcelona Restaurant Group focus on fit? What types of
fit does Barcelona try to optimize when hiring?
2. How does sending managerial candidates on a $100 “Shop” serve as a
realistic job preview? Explain why you think this would or would not
be effective in helping job candidates assess their fit with the Barce lona Restaurant Group.
3. Besides the “Shop”, how else does Barcelona try to maximize employee
fit? What other suggestions do you ha ve for the company to improve
new hires’ fit with the job and organization?
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
115
PART 2 | Individual Behaviors and Processes in Organizations
VIDEO C A S E
PERCOM/SHUTTERSTOCK.COM
116
Now What?
While waiting for a customer phone call with two subordinates, imagine that
another subordinate walks into the room and exhibits agitated behavior after
being unable to find something. The other employees in the room clearly feel
uncomfortable as a result of this behavior. What do you say or do? Go to this
chapter’s “Now What?” video, watch the challenge video, and choose a response.
Be sure to also view the outcomes of the two responses you didn’t choose.
Discussion Questions
1. Which aspects of management and organizational behavior discussed
in this chapter are illustrated in these videos? Explain your answer.
2. Which do you feel is more important at work, an employee’s behavior
or performance? Why?
3. As a manager, what else might you do to effectively handle this situation?
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
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86Goleman, D. (2006). Social Intelligence: The New Science of
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87Dulewicz, V., & Higgs, M. (2004). Can Emotional Intelligence
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88 Locke, E. A. (2005). Why Emotional Intelligence Is an
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89Schulte, M. J., Ree, M. J., & Carretta, T. R. (2004). Emotional
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90O’Boyle, E. H., Humphrey, R. H., Pollack, J. M., Hawver, T.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
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LOSKUTNIKOV/SHUTTERSTOCK.COM
CHAPTER
4
INDIVIDUAL VALUES,
PERCEPTIONS, AND REACTIONS
Real World Challenge: Attitude is a
Choice at Pike Place Fish Market
CHAPTER
OUTLINE
ATTITUDES IN ORGANIZATIONS
How Attitudes Are Formed
Cognitive Dissonance
Attitude Change
Key Work-Related Attitudes
VALUES AND EMOTIONS IN
ORGANIZATIONS
Types of Values
Conflicts among Values
The Role of Emotions in Behavior
Affect and Mood
PERCEPTION IN ORGANIZATIONS
Basic Perceptual Processes
Complex Perceptual Processes
Understand Yourself: Positive and
Negative Affectivity
Perception and Attribution
After studying this chapter, you should be
able to:
LEARNING
OUTCOMES
1 Discuss how attitudes are formed,
describe the meaning of cognitive
dissonance, and identify and describe
three important work-related attitudes.
2 Describe the role and importance of
Global Issues: How Culture Can Affect
Attributions
Perception of Fairness, Justice, and
Trust
Case Study: What to Do When the
Boss Releases His Inner Toddler
STRESS IN ORGANIZATIONS
The Nature of Stress
Common Causes of Stress
Consequences of Stress
Improve Your Skills: Stress
Management Tips
Managing and Controlling Stress
Work-Life Balance
SUMMARY AND APPLICATION
Real World Response: Attitude is a
Choice at Pike Place Fish Market
3 Describe basic perceptual processes
and how perception affects fairness,
justice, and trust in organizations.
4 Discuss the nature of stress, identify
the basic causes and consequences
of stress, and describe how stress can
be managed.
values and emotions in organizational
behavior.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
ATTITUDE IS A CHOICE AT PIKE
PLACE FISH MARKET1
LOSKUTNIKOV/SHUTTERSTOCK.COM
REAL WORLD CHALLENGE
John Yokoyama did not plan on owning Seattle’s Pike Place Fish Market. Selling fish is
a tough job. The days are long—most employees at Seattle’s Pike Place Fish work from
6:30 a.m. to 6:30 p.m.—and the work can be boring and tiring. But when the owner of the
business decided to get out, Yokoyama decided to buy the business instead of losing his job.
As a manager, Yokoyama demanded results from his employees and came down hard
on their mistakes. He never went on vacation, and insisted on managing all of his company’s activities himself. He emulated the previous owner’s negative attitudes, anger, and
fear-based management style. No one working there was having fun, including Yokoyama.
As his business struggled, employee turnover was high and morale was low. Yokoyama
knew he was not getting the best from his employees and recognized that he needed to
change his managerial values and style to save his business. He realized that if he could
better involve his employees and improve their attitudes, his business would be likely to
improve. Yokoyama asks you for advice on improving his employees’ attitudes. After reading this chapter, you should have some good ideas for him.
JOSEPH SOHM/SHUTTERSTOCK.COM
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124
PART 2 | Individual Behaviors and Processes in Organizations
If your boss asked you to work harder, could you? Most of us could probably
give at least some additional effort if we chose to do so. Because attitudes, values, and perceptions all influence our behavior and job satisfaction, effectively
managing them is one w ay to increase employees’ discretionary effort and
improve performance. Employees work harder and are less likely to quit their
jobs when their personal values are consistent with the organization’s values,
when they are satisfied with their jobs, and when they have positive attitudes
about the company and the work environment.2
Chapter 3 introduced the concept of individual differences and explored
personality, intelligence, and learning styles. This chapter continues our focus
on individual behavior in organizations. We begin with a discussion of atti tudes, examining how attitudes are formed and changed, cognitive dissonance,
and three key work-related attitudes. Next we look at how values and emo tions affect organizational beha vior. The role of perception, especially as it
relates to issues of fairness and trust, is then discussed. Finally, our chapter
concludes with a section devoted to stress in organizations—its causes and
consequences and how it can be managed.
ATTITUDES IN ORGANIZATIONS
attitudes
A person’s complexes of
beliefs and feelings about
specific ideas, situations,
or other people
People’s attitudes obviously affect their behavior in organizations. A
­ ttitudes
are complexes of beliefs and feelings that people ha ve about specific ideas,
­s ituations, or other people . Attitudes are important because they are the
mechanism through which most people express their feelings. An employee’s statement that he feels underpaid by an organization reflects his feel ings about his pay. Similarly, when a manager says that she likes a new
advertising campaign, she is expressing her feelings about the organization’s
­marketing efforts.
How Attitudes Are Formed
CARLO
AL
LEGRI
/REUT
ERS
Attitudes are formed by a variety of forces ,
including our personal values , our experi ences, and our personalities. For example, if we
value honesty and integrity, we may form especially favorable attitudes tow ard a manager
whom we believe to be very honest and moral.
Similarly, if we have had negative and unpleasant experiences with a particular coworker, we
may form an unfavorable attitude toward that
person. Any of the “Big Five” or individual personality traits discussed in Chapter 3 may also
Attitudes are our beliefs and feelings about ideas, situations, or
people. During a presidential campaign we form attitudes about
various candidates--some good, others bad. But if our preferred
candidate is eliminated or drops out of the race we may need to
form new attitudes about those candidates who remain.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 4 | Individual Values, Perceptions, and Reactions
influence our attitudes. Understanding the basic structure of an attitude helps
us see how attitudes are formed and can be changed.
Attitudes are usually viewed as stable dispositions to beha ve toward
objects in a certain way. For any number of reasons, a person might decide that
he or she does not like a particular political figure or a certain restaurant
(a disposition). We would expect that person to express consistently negative
opinions of the candidate or restaurant and to maintain the consistent, predictable intention of not voting for the political candidate or not eating at the
restaurant. In this view, as illustrated in Figure 4.1, attitudes contain three
­components: cognition, affect, and intention.
Cognition is the knowledge a person presumes to have about something.
You may believe you like a class because the textbook is excellent, the class
meets at your favorite time, the instructor is outstanding, and the workload
is reasonable. This “knowledge” may be true, partially true, or totally false.
For example, you may intend to vote for a particular candidate because you
think you know where the candidate stands on several issues. In reality,
depending on the candidate’s honesty and your understanding of his or her
statements, the candidate’s thinking on the issues may be exactly the same
as yours, partly the same, or totally different. Cognitions are based on perceptions of truth and reality, and, as we note later, perceptions agree with
reality to varying degrees.
A person’s affect is his or her feelings toward something. In many ways,
affect is similar to emotion—it is something over whic h we have little or no
conscious control. For example, most people react to words suc h as “love,”
“hate,” “sex,” and “war” in a manner that reflects their feelings about what
those words convey. Similarly, you may like one of your classes, dislike another,
and be indifferent toward a third. If the class you dislike is an elective , you
may not be particularly concerned. But if it is the first course in your c hosen
major, your affective reaction may cause you considerable anxiety.
Intention guides a person’s behavior. If you like your instructor, you may
intend to take another c lass from him or her next semester . Intentions are
not always translated into actual behavior, however. If the instructor’s course
125
cognition
The knowledge a person
presumes to have about
something
affect
A person’s feeling toward
something
intention
Component of an attitude
that guides a person’s
behavior
Figure 4.1
Attitude Formation
Cognition
Affect
Behavioral Intention
Attitudes are generally
formed around a
sequence of cognition,
affect, and behavioral
intention. That is,
we come to know
something that we
believe to be true
(cognition). This
knowledge triggers
a feeling (affect).
Cognition and affect
then together influence
how we intend to
behave in the future.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
126
PART 2 | Individual Behaviors and Processes in Organizations
next semester is scheduled for 8 a.m., you
may decide that another instructor is just
as good. Some attitudes, and their corresponding intentions, are much more central and significant to an individual than
others. You may intend to do one thing
(take a particular class) but later alter your
intentions because of a more significant and
central attitude (fondness for sleeping late).
Cognitive Dissonance
VESNA
ANDJIC
/GETTY
IMAGES
Affect, cognition, and behavioral intention are the primary components
of an attitude. For instance, you may like a particular professor (affect),
believe that she or he is a great instructor (cognition), and plan to take
another class from the professor next semester (behavioral intention).
However, if the class ends up scheduled at
8:00 am you may reconsider if you have an early
morning job or just like to sleep late!
cognitive dissonance
An incompatibility or
conflict between behavior
and an attitude or
between two different
attitudes
Cognitive d issonance p lays a n i mportant
role in how attitudes affect our beha vior. For
instance, suppose that you strongly believe that
all companies need to be both profitable and environmentally responsible, and
that you are the new CEO of a company that is a terrible polluter . You learn
that reducing your company’s carbon emissions would be so expensive that the
company would no longer be profitable. What would you do? The gap between
your environmentally responsible attitude and your attitude that your responsibility is to run a profitable company creates what is called cognitive dissonance. ­Cognitive dissonance is an incompatibility or conflict between
behavior and an attitude or between two different attitudes . 3 When people
experience d
­ issonance, they often use one of four approac hes to cope with it.
Using the scenario above, these would include:
1. You can change your behavior and reduce the company’s carbon emissions.
2. You can reduce the felt dissonance by reasoning that the pollution is not
so important when compared to the goal of running a profitable company.
3. You can change your attitude toward pollution to decrease your belief that
pollution is bad.
4. You can seek additional information to better reason that the benefits
to society of manufacturing the products outweigh the societal costs of
polluting.
Interestingly, though, sometimes people are aware of their dissonance but
make a conscious decision to not reduce it. This decision would influenced by
these three things:
1. Your perception of the importance of the elements that are creating the
dissonance: Given your strong belief about the importance of environmen tal responsibility, it will be more difficult for you to ignore the dissonance .
If the elements involved in the dissonance are less important to you, it is
easier to ignore it.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 4 | Individual Values, Perceptions, and Reactions
2. The amount of influence you feel you have over these elements: If you are
being prevented by the Board of Directors from investing in pollutionreducing technology, it would be easier to rationalize the dissonance and
not take action. If you are making the decision alone , however, then you
are more likely to address the dissonance in a more active way.
3. The rewards involved in the dissonance: Rewards for dissonance tend to
decrease our reactions to it. If your sizeable annual bonus is based on
the firm’s financial performance, for example, and not its environmental
record, then you would likely be less inclined to take action to address the
dissonance.
Attitude Change
M
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UTTERST
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O
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Attitudes are not as stable as personality attributes. For example, new information may change attitudes. A manager may have a negative attitude about
a new colleague because of the colleague’s lack of job-related experience. After
working with the new person for a while, however, the manager may come to
realize that he is actually very talented and subsequently develop a more positive attitude. Likewise, if the object of an attitude changes, a person’s attitude
toward that object ma y also change. Suppose, for example, that employees
feel underpaid and as a result have negative attitudes toward the company’s
reward system. A big salary increase ma y cause these attitudes to become
more positive.
Attitudes can also c hange when the object of the attitude becomes less
important or less relevant to the person. For example, suppose an employee
has a negative attitude about his company’s health insurance. When his spouse
gets a new job with an organization that has outstanding insurance benefits ,
his attitude toward his own insurance may become more moderate s imply
because he no longer has to worry about it. Finally, as noted earlier, individuals may change their attitudes as a way to reduce cognitive dissonance.
Deeply rooted attitudes that have a long history are, of course, resistant
to change. For example, over a period of years a former airline executive named F rank Lorenzo developed a reputa tion in the industry of being antiunion and
of cutting wages and benefits. As a result,
employees throughout the industry came to
dislike and distrust him. When he took over
Eastern Airlines, its employees had suc h a
strong attitude of distrust tow ard him that
they could never agree to cooperate with any
of his programs or ideas. Some of them actu ally cheered months later when Eastern went
bankrupt, even though it w as costing them
their own jobs!
Cognitive dissonance is sometimes experienced by people
who smoke. Their cognition “tells” them that smoking is
not healthy, but their behavior (smoking) contradicts this
knowledge. To cope with the dissonance they may set goals
for themselves to quit at some point in the future.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
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127
128
PART 2 | Individual Behaviors and Processes in Organizations
Job satisfaction is caused by a variety of factors in the workplace,
including such things as the work itself and the pay an individual
receives. The attitudes expressed by coworkers, colleagues, and others
in the organization can also play a role. For instance,
if our coworkers are happy and excited about the
work and the organization their enthusiasm may be
contagious and contribute to our own job satisfaction.
Key Work-Related Attitudes
BLUESK
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People in an organization form attitudes about
many different things. Employees are likely
to have attitudes about their salary, their promotion possibilities, their boss, employee benefits, the food in the company cafeteria, and the
color of the company softball team uniforms. Of
course, some of these attitudes are more impor tant than others. Especially important attitudes
are job satisfaction, organizational commitment,
and employee engagement.
job satisfaction
Reflects our attitudes and
feelings about our job
Job Satisfaction
Job satisfaction is one of the most commonly studied organizational outcomes in the field of organizational behavior. Our job
satisfaction reflects our attitudes and feelings about our job. As illustrated
in Figure 4.2, the ­factors that have the greatest influence on job satisfaction
Figure 4.2
Job satisfaction is one
of the most important
job-related attitudes in
organizations. It reflects
both our attitudes and
our feelings about our
job. Job satisfaction is
strongly influenced by our
personality, values, other
attitudes, and the work
itself.
Influences on Job Satisfaction
The Work
Itself
Personality
Job Satisfaction
Attitudes
Values
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
129
are: the work itself, attitudes, values, and personality. Satisfaction with the
nature of the work itself is the largest influence on job satisfaction. If you
do not like the work you are doing , it is hard to be satisfied with your job .
Challenging work, autonomy, variety, and job scope also increase job satisfaction.4 As a manager, if you want to increase your subordinates’ job satisfaction,
focus first on improving the nature of the work they do .5 Coworkers, bosses,
and subordinates are part of the work experience and can also influence job
satisfaction. Their attitudes and perceptions can be contagious, especially for
new hires forming impressions about the job and company. If coworkers are
unhappy and dissatisfied with their jobs, new hires are more likely to be dis satisfied than if they regularly interact with happy and satisfied coworkers.
Our attitudes and values about work also influence our job satisfaction.
Someone with a negative attitude tow ard work is less likely to be satisfied
with any job than someone with a positive attitude tow ard work. Employees
who find intrinsic value in their work are doing what is important to them. If
someone values challenge and variety in work, that person will be more satisfied with jobs with these characteristics than with monotonous work.
Interestingly, our job satisfaction is somewhat stable over time, even when
we change jobs or employers. 6 Some people are rarely satisfied with their jobs,
and others tend to be satisfied no matter what job they ha ve. Research evidence suggests that differences in job satisfaction are due in part to differences
in employees’ genetics and personality.7 In particular, core self-evaluation, 8
extroversion, and conscientiousness 9 influence job satisfaction. Accordingly,
selecting extroverted, conscientious people who are a good fit with the job and
who have high core self-evaluations (a broad, general, positive self-regard 10)
can enhance employees’ job satisfaction.
Are happy employees really more productive employees? The answer is
yes. And the positive relationship between job satis faction and job performance is even stronger for complex, professional jobs.11 Satisfied employees also benefit organizations because job satisfaction positively influences
employees’ attitudes and organizational citizenship behaviors (as discussed
in Chapter 1). 12 Conversely, job dissatisfaction is related to higher absentee ism and turnover, as well as to other withdrawal behaviors such as lateness,
drug abuse, grievances, and retirement decisions.13 It isn’t just the level of
job satisfaction that matters, however. If job satisfaction is declining, turnover intentions and actual turnover are particularly likely to increase . 14
Because of the potentially high cost of these employee beha viors, the financial impact of improving employees’ job satisfaction can make it worthwhile
for managers to invest in improving employee attitudes toward their jobs
and the company.
Organizational Commitment
Organizational commitment reflects the degree to which an employee
­identifies with the organization and its goals and w ants to sta y with the
­organization. There are three ways we can feel committed to an employer:
1. Affective commitment: positive emotional attac hment to the organiza tion and strong identification with its values and goals . Employees of a
­children’s hospital ma y be affectively committed to the organization
because of its goal of providing top-quality health care to kids . Affective
commitment leads employees to stay with an organization because they
want to, and is related to higher performance.
organizational
commitment
Reflects the degree to
which an employee
identifies with the
organization and its
goals and wants to stay
with the organization
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130
PART 2 | Individual Behaviors and Processes in Organizations
2. Normative commitment: feeling obliged to stay with an organization for
moral or ethical reasons. An employee who has just finished an MBA
paid for by a firm’ s tuition reimbursement program might feel a moral
obligation to stay with the employer for at least a few years to repa y the
debt. Normative commitment is related to higher performance and leads
employees to stay with an organization because they feel they should.
3. Continuance commitment: staying with an organization because of per ceived high economic (taking another job would mean losing valuable
stock options) and/or social costs (friendships with coworkers) involved
with leaving. Continuance commitment leads employees to sta y with an
organization because they feel that they have to.
These three types of organizational commitment are not mutually exc lusive. It is possible to be committed to an organization in affective , normative,
and continuance ways at the same time, at varying levels of intensity. At any
point in time, an employee has a “commitment profile” that reflects high or
low levels of all three types of organizational commitment. 15 Different profiles
have different effects on workplace behavior such as job performance, absenteeism, and the chance that the organization member will quit.16
employee engagement
Heightened emotional
and intellectual
connection that an
employee has for his/
her job, organization,
manager, or coworkers
that, in turn, influences
him/her to apply
additional discretionary
effort to his/her work
Employee Engagement
If you did not like your coworkers, your boss was mean, and you did not have
the resources you needed to get your job done, how would you feel about your
job? Would you put 100 percent into your work? When we feel respected and
see how our work matters to the company and to others , we feel more enthusiastic and engaged. Employee engagement is “a heightened emotional and
intellectual connection that an employee has for his/her job , organization,
manager, or coworkers that, in turn, influences him/her to apply additional
discretionary effort to his/her work.”17
Engaged employees give their full effort to their jobs , often going beyond
what is required because they are passionate about the firm and about doing
their jobs well. Disengaged workers do not perform close to their potential capability, lacking the emotional and motivational connections to their
employer that drive discretionary effort. Rather than wanting to do the work
and wanting to do their best, disengaged workers feel they have to do the
work, and generally do only what they have to do as a result.
One study found that more than 50 percent of senior executives ha ve “less
than ideal emotional connection and alignment” to their organization. 18 This is
particularly troubling given the financial consequences of low engagement. High
employee engagement is related to superior business performance. Towers Perrin
found that high-engagement organizations have a 28 percent earnings-per-share
(EPS) growth rate compared to low-engagement organizations’ 11 percent EPS
decline.19 A report from the Society for Human Resource Management found that
strengthening employee engagement saved one company $1.7 million in just one
year.20 As a manager, remember that the drivers of employee engagement can
differ from the drivers of employee attraction and retention—what gets employ ees into an organization is not the same as what keeps them engaged and keeps
them from leaving.21 Engagement is enhanced when employees:
•
•
•
Have clear goals and roles
Have the resources needed to do a good job
Get meaningful feedback on their performance
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 4 | Individual Values, Perceptions, and Reactions
131
Table 4.1
Top Three Worldwide Drivers of Employee Attraction, Retention, and Engagement for Dif ferent
Age Groups
Top Drivers of Attraction for 18- to
24-Year-Olds
Top Drivers of Retention for 18- to
24-Year-Olds
Top Drivers of Engagement for 18- to
24-Year-Olds
Career advancement opportunities
Have excellent career advancement
opportunities
Organization develops leaders at
all levels
Competitive base pay
Work in an environment where new
ideas are encouraged
Organization quickly resolves
customer concerns
Learning and development
opportunities
Satisfaction with the organization’s
business decisions
Senior management is sincerely
interested in employee well-being
Top Drivers of Attraction for 45- to
54-Year-Olds
Top Drivers of Retention for 45- to
54-Year-Olds
Top Drivers of Engagement for 45- to
54-Year-Olds
Competitive base pay
Organization’s reputation as a great
place to work
Senior management is sincerely
interested in employee well-being
Challenging work
Satisfaction with the organization’s
people decisions
Improved my skills and capabilities
over the last year
Convenient work location
Understand potential career track
within the organization
The organization’s reputation for
social responsibility
Source: Based on information provided in Exhibits 14, 15, and 16 of Towers Perrin Global Workforce Study—Global Report at http://www.towersperrin
.com/tp/ getwebcachedoc?webc=HRS/USA/2008/200803/GWS_Global_Report20072008_31208.pdf.
•
•
•
•
•
Are able to use their talents
Are recognized for doing a good job
Have positive relationships with coworkers
Have opportunities to learn and grow
Have supportive leadership
Table 4.1 summarizes the results of a recent global Towers Perrin survey on the different worldwide drivers of employee attraction, retention, and
engagement by generation.
VALUES AND EMOTIONS IN
ORGANIZATIONS
Values and emotions are also important elements of individual beha vior in
organizations. Values are ways of behaving or end-states that are desirable
to a person or to a group. Values can be conscious or unconscious.22 Although
our values tend to be fairly well established by the time we are teenagers ,
they can be reshaped by major life events inc luding the birth of a child, going
to war, the death of a loved one, illness, or even business failure. Work values
influence important individual and organizational outcomes including performance and retention, and are often considered to be important work outcomes
in themselves.23
values
Ways of behaving or endstates that are desirable
to a person or to a group
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132
PART 2 | Individual Behaviors and Processes in Organizations
A company leader’s personal values affect the firm’s business strategy 24
and all aspects of organizational behavior including staffing, reward systems,
manager–subordinate relationships, communication, conflict management
styles, and negotiation approaches.25 Personal values also influence ethical
choices. When there are no clear rules for dealing with specific ethical prob lems, we tend to respond to each situation on an individual basis depending
on our values at that time.26 Our personal values combine with organizational
influences like company culture to generate decisions that can be significantly
different from those made based solely on our personal values . 27 Strong company cultures help to guide us when making these ambiguous choices. However, if personal values conflict with the organization’ s cultural values, it is
difficult to maintain ethical norms.28
Types of Values
Values can be described as terminal or instrumental, and as intrinsic or
extrinsic. Let’s explore each of these distinctions.
terminal values
Reflect our long-term life
goals, and may include
prosperity, happiness,
a secure family, and a
sense of accomplishment
instrumental values
Our preferred means of
achieving our terminal
values or our preferred
ways of behaving
intrinsic work values
Relate to the work itself
extrinsic work values
Relate to the outcomes of
doing work
Terminal and Instrumental Values
One noted researcher has identified two types of values: terminal and
instrumental. 29 Terminal values reflect our long-term life goals, and
may include prosperity, happiness, a secure family, and a sense of accom plishment. People who value family more than career success will work
fewer hours and spend more time with their kids than people whose values
put career success first. Of course, this does not mean that ha ving strong
family values will prevent one from ha ving a successful career. Terminal
values can change over time depending on our experiences and accomplishments. When a career-oriented person sells her business for a lot of money,
her prosperity goals ma y be reac hed and family ma y then become most
important.
Instrumental values are our preferred means of achieving our terminal
values or our preferred ways of behaving. Terminal values influence what we
want to accomplish; instrumental values influence how we get there. Honesty, ambition, and independence are examples of instrumental values that
guide our behavior in pursuit of our terminal goals. The stronger an instrumental value is, the more we act on it. People who value honesty behave
more ethically in pursuing the terminal value of prosperity and a sense of
accomplishment than do people with a lower honesty instrumental value.
Intrinsic and Extrinsic Work Values
Intrinsic work values relate to the work itself.30 For example, some employees want challenging jobs with a lot of variety that require them to continually
learn new things, whereas others prefer simpler jobs they can perform in the
same way every day. Most people need to find some personal intrinsic value
in their work to feel truly satisfied with it. 31 Valuing challenging work and
learning new skills can help advance your career. Extrinsic work ­values are
related to the outcomes of doing work. 32 Employees who work to earn money
or to have health benefits are satisfying extrinsic work values. Having high
status in the company, getting recognized for quality work, and having job
security are extrinsic work values.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 4 | Individual Values, Perceptions, and Reactions
133
Extrinsic work values relate to the outcomes of doing work. For instance,
if a person works to earn money, achieve status, or get a large corner
office such as this one then that individual is largely driven by extrinsic
work values.
Conflicts among
Values
RACOR
N/SHUT
TERSTO
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Intrapersonal, interpersonal,
and individual-organization
value conflicts all influence
employee attitudes, retention,
job satisfaction, and job per formance. When highly ranked
instrumental and terminal val ues conflict and both cannot be
met, we experience inner conflict
and stress. At some point in their
career, many managers experi ence an intrapersonal value
conflict between the instrumental
value of ambition and the terminal
value of happiness. If being happy
pulls us to spend quality time with
our family or pursuing a hobby we love,
but personal ambition pulls us to work longer hours and pursue promotions ,
we feel ­conflicted. People are generally happier and less stressed when their
instrumental and terminal values are aligned.
Unlike intrapersonal value conflicts , which are internal to an individ ual, interpersonal value conflicts occur when two different people hold
conflicting values. Interpersonal value conflicts are often the cause of per sonality clashes and other disagreements. If one coworker values individual
rewards and the other values group recognition the two ma y clash over how
to approach a new project. As a manager, it is important to remember that
people’s constellations of instrumental and terminal values differ. These dif ferences can lead to differences in work styles, work preferences, and reactions
to announcements or events.
Finally, just as two different employees’ values can conflict, an employee’s
values can conflict with the values of the organization, creating individualorganization value conflict. Lower individual-organization value conflict
leads to greater job satisfaction, higher performance, lower stress, and greater
job commitment.33
intrapersonal value
conflict
Conflict between the
instrumental value of
ambition and the terminal
value of happiness
interpersonal value
conflict
Occurs when two
different people hold
conflicting values
individual-organization
value conflict
When an employee’s
values conflict with the
values of the organization
How Values Differ around the World
Global differences in values can also lead to different managerial beha viors.
For example, Latin Americans tend to highly value family loyalty, which leads
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
134
PART 2 | Individual Behaviors and Processes in Organizations
them to hire competent family members whenever possible .34 Managers in
the United States tend to strongly value individual ac hievement, which leads
them to emphasize a candidate’s previous performance and skill assessments
rather than family ties.
Values are influenced by culture. Research has found that a large number of
basic values can be condensed into two major dimensions that vary across cultures: (1) traditional/secular-rational values and (2) survival/self-expression values.35 Traditional/secular-rational values reflect the contrast between societies
in which religion is very important and those in which it is not. More traditional
societies emphasize the importance of parent-child ties and deference to authority, which is reflected in high levels of national pride and a nationalistic outlook.
Societies with secular-rational values have the opposite characteristics.
Survival values emphasize economic and physical security. Self-expression values emphasize subjective well-being , self-expression, and quality of
life, giving high priority to environmental protection, diversity tolerance, and
participation in decision making. Societies that rank high on self-expression
values also tend have higher interpersonal trust and tolerance and value individual freedom and self-expression. 36 Figure 4.3 illustrates how these two
major dimensions of values differ in a variety of countries.
The Role of Emotions in Behavior
emotions
Intense, short-term
physiological, behavioral,
and psychological
reactions to a specific
object, person, or
event that prepare us to
respond to it
Emotions also play an important role in organizations. Do you behave the same
way or perform as well when you are excited as you do when you are unhappy or
afraid? Of course not—which is the reason why emotions play an important role in
the workplace. It is easy to imagine the performance difference of unhappy salespeople compared to a happy sales staff. Employees who effectively manage their
emotions and moods can create a competitive advantage for a company . Would
Starbucks or Nordstrom be as successful with moody employees? It is not likely.
We all experience emotions at work. Our behaviors are not guided solely
by conscious, rational thought. In fact, emotion often plays a larger role in our
behaviors than does conscious reasoning. Emotions are intense, short-term
physiological, behavioral, and psychological reactions to a specific object, person, or event that prepare us to respond to it. Let’s break this definition down
into its four important elements:
1. Emotions are short events or episodes. Emotions are relatively short-lived.
Excitement about making a big sale or anxiety over a looming deadline
subsides after a little while.
2. Emotions are directed at something or someone. This differentiates emotions from moods, which are short-term emotional states that are not
directed toward anything in particular.37 Moods are less intense than emotions and can change quickly. The cause of emotions can be readily identified—making a big sale or facing a deadline, for example.
3. Emotions are experienced. They involve involuntary changes in heart rate,
blood pressure, facial expressions, animation, and vocal tone. We feel emotion.
4. Emotions create a state of physical readiness through physiological reac tions. Increased heart rate, adrenaline, and eye movements prepare our
bodies to take action. Particularly strong emotions including fear, anger, and
surprise can demand our attention, interrupt our thoughts, and motivate us
to respond by focusing our attention on whatever is generating the emotion.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 4 | Individual Values, Perceptions, and Reactions
135
Figure 4.3
Secular-Rational Values
How Values Differ Around the World
2.0
Japan
1.5
1.0
Co
Russia
Bulgiria
Ukraine
Estonia
China
Moldova
Hungary
Macedonia
Ex-C
0
Czech
France
ist
Romania
Traditional Values
Spain
Catholic Europe
Uruguay
Turkey
Indonesia
Iceland
Austria
Great
Britain
Italy
Poland
South
Asia
Luxembourg
Belgium
Israel
Croatia
India
Netherlanda
Switzarland
Greece
un
omm
Georgia
Azerbaijan
Denmark
Finland
Slovakia
Bosnia
–1.0
West
Germany
Slovenia
Tahvan
Armenia
–0.5
Sweden
Protestant
Europe
Norway
East
Germany
S.Korea
Belarus
LithMontenegro uaria
Latvia
Serbia
Albania
0.5
nfu
n
cia
Values differ around
the world. One useful
way to understand
differences in values is in
terms of secular/rational
values and survival/
self-expression values.
This figure illustrates how
different regions of the
world reflect these two
sets of values.
New Zealand
English
speaking
N.Ireland
Canada
Australia
U.S.A.
Vietnam
Portugal
Chile Argentina
Ireland
Philippines
Bangladesh
Dominican
Iran
Republic
South Peru
Pakistan
Brazil Latin America
Africa
Jordan
Uganda Ghana
Mexico
Nigeria Venezuela
Zimbabwe
Algeria Egypt
Morocco
Tanzania
Colombia
–1.5
Africa
–2.0
El Salvador
–2
–1.5
Survival Values
–1
–0.5
0
0.5
Puerto
Rico
1
1.5
2
Self-Expression Values
Factor Score
Source: Inglehart, R., & Welzel, C. (2005). Modernization, Cultural Change and Democracy (p. 64). New York:
Cambridge University Press. Based on the World Values Surveys, see http://www.worldvaluessurvey. Org.
Copyright © 2005 Ronald Inglehart and Christian Welzel. Reprinted with the permission of Cambridge
University Press.
Whereas an attitude can be thought of as a judgment about something , an
emotion is experienced or felt. Emotions do not last as long as attitudes. Emotions
influence how we perceive the world, help us interpret our experiences, and prime
us to respond. Why is understanding the role of emotions important to organiza tions? First, because emotions are malleable, effective employees and managers
know how to positively influence their own emotions and the emotions of others.38
Second, emotions influence both the creation and maintenance of our motivation
to engage or to not engage in certain beha viors. Third, research has found that
emotion can influence turnover, decision making, leadership, helping behaviors,
and teamwork behaviors.39 The quality of subordinates’ emotional exc hanges
with their leader also influences the affective tone of the workgroup .40 Effective
leaders use emotion to generate positive follower behaviors.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
136
PART 2 | Individual Behaviors and Processes in Organizations
Affect and Mood
moods
Short-term emotional
states that are not
directed toward anything
in particular
affectivity
Represents our tendency
to experience a particular
mood or to react to things
with certain emotions
positive affect
Reflects a combination of
high energy and positive
evaluation characterized
by emotions like elation
TERRE
GETTY NCE VACCARO
IMAGES
/© 2007
NBAE/
negative affect
Comprises feelings of
being upset, fearful, and
distressed
Although the cause of emotions tends be obvious, the cause of mood tends to
be more unfocused and diffused. Moods are short-term emotional states that
are not directed toward anything in particular. Unlike instant reactions that
produce emotion, and that c hange with expectations of future pleasure or
pain, moods are harder to cope with, can last for days, weeks, months, or even
years.41 Our mood at the start of a workda y influences how we see and react
to work events, which influences our performance.42 Because moods reflect an
individual’s emotional state, researchers typically infer the existence of moods
from a variety of behavioral cues.
Our moods can be influenced by others. Nasty interactions with coworkers can impact our mood five times more strongly than positive interac tions.43 Workgroups tend to experience shared group moods when they can
display mood information to each other through facial, vocal, and behavioral
cues. 44 Subordinates’ attributions of their leader’s sincere versus manipulative intentions also influence their emotional responses to the leader. 45
Altering characteristics of the group’s work, changing elements of the work
context, or changing group membership in a way that changes the manner in
which coworkers interact can change the amount and type of mood informa tion members get from each other and influence employees’ moods.
Affectivity represents our tendency to experience a particular mood or to
react to things with certain emotions.46 Researchers have identified two types
of affectivity: positive and negative. Individuals with a high positive affectivity
experience tend to experience more positive emotions, including cheerfulness
or enthusiasm. Individuals higher in negative affectivity tend to experience
more negative emotions, such as irritation or nervousness.
The two dominant dimensions of mood are positive affect, whic h
reflects a combination of high energy and positive evaluation characterized
by emotions like elation, and negative affect, which comprises feelings of
being upset, fearful, and distressed. 47 As shown in Figure 4.4, positive and
negative affect are not opposites , but are
two distinct dimensions.48 Not being elated
does not mean that you are upset, and
not being sad does not mean that you are
elated. Affect tends to be somewhat dispositional and fairly stable over time. Some
people just tend to be more positive and
optimistic than others. 49 Negative affect is
related to lower organizational citizenship
behaviors, greater withdrawal and counterproductive work behaviors, lower job satis faction, and greater injuries . 50 Affectivity
can also be important to training outcomes .
Affect and mood play important roles in how we perform our
jobs and how others perceive us. These two Starbucks baristas,
for example, are happy and engaging. Their positive mood and
affect, in turn, can make their customers feel good as well.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
137
Figure 4.4
Positive and Negative Affect
Negative
affect
Neither positive
nor negative affect
Positive
affect
Source: Thompson, E. R., Development and Validation of an Internationally Reliable Short-Form of the Positive and
Negative Affect Schedule (PANAS), Journal of Cross-Cultural Psychology, 38 (2), 227–242. © 2007 by SAGE
Publications. Reprinted by Permission of SAGE Publications.
Affect can vary anywhere
along a continuum
ranging from positive
affect to negative affect.
As illustrated here, it is
also possible to fall in
between these extremes
and reflect neither
positive nor negative
affect.
Employees with greater positive affect or lower negative affect experience
a greater increase in self-efficacy after training. This suggests that affectivity
may be an important thing to consider when choosing people to participate
in development programs.51
Moods and emotions can also influence our satisfaction with our jobs and
employers. Higher positive affect is related to increased creativity, openness
to new information, and efficient decision making.52 Positive affectivity also
increases the likelihood of cooperation strategies in negotiations , improving
the results.53 Numerous studies show that happy individuals are successful in
many areas of their lives, including marriage, health, friendship, income, and
work performance.54
PERCEPTION IN ORGANIZATIONS
Perception—the set of processes by whic h an individual becomes a ware of
and interprets information about the environment—is another important element of workplace behavior. If everyone perceived everything the same way,
things would be a lot simpler (and a lot less exciting!). Of course, just the opposite is true: People perceive the same things in very different w ays.55 Moreover, people often assume that reality is objective and that we all perceive the
same things in the same way.
To test this idea, we could ask students at the University of Michigan and Ohio State University to describe the most recent football game
between their sc hools. We probably would hear two conflicting stories .
These differences would arise primarily because of perception. The fans
“saw” the same game but interpreted it in sharply contrasting w ays. Since
perception plays a role in a variety of workplace beha viors, managers
should understand basic perceptual processes . As implied in our defini tion, perception actually consists of several distinct processes. Moreover,
in perceiving we receive information in many guises, from spoken words to
visual images of ­movements and forms. Through perceptual processes, the
receiver ­assimilates the varied types of incoming information for the pur pose of interpreting it.56
perception
The set of processes
by which an individual
becomes aware of and
interprets information
about the environment
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138
PART 2 | Individual Behaviors and Processes in Organizations
Perception is often illustrated by the different reactions of fans of two rival athletic teams. For
example, suppose these fans are watching a close football game and the outcome is determined
by a controversial play in the closing seconds. The fans dressed in green may all agree that the
play was called correctly by the referees, while fans of the red team may argue that the referees
made the wrong call and cost their team a victory. Their perceptions will be
different even though they all saw the same events.
Basic Perceptual
Processes
EWSCO
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Two basic perceptual pro cesses are particularly relevant to managers—selective
perception and stereotyping.
Selective Perception
MARCU
S SCHE
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MEDIA/N
S e l e c t i v e p e r c ep t i o n i s
the pr ocess o f sc reening
out ­i nformation that we are
uncomfortable with or that
contradicts our beliefs . F or
example, s­ uppose a manager is
exceptionally fond of a particu lar worker. The manager has a
very positive attitude about that
worker and considers her to be an
outstanding ­p erformer. One da y
the manager observes this individual ­apparently sleeping at her desk.
The manger may assume that the worker sta yed up working late the night
before and is just taking a short nap. Alternatively, suppose the manager has
a very ­negative attitude about the worker and observes the same beha vior. In
this case the manager might assume that the worker w as out late partying
the night before, perhaps reinforcing the negative attitude.
selective perception
The process of screening
out information that we
are uncomfortable with
or that contradicts our
beliefs
stereotyping
The process of
categorizing or labeling
people on the basis of a
single attribute
Stereotyping
Stereotyping is categorizing or labeling people on the basis of a single attri bute. Certain forms of stereotyping can be useful and efficient. Suppose, for
example, that a manager believes that communication skills are important for
a particular job and that speech communication majors tend to have exceptionally good communication skills. As a result, whenever he interviews candidates
for jobs he pays especially close attention to speech communication majors. To
the extent that communication skills truly predict job performance and that
majoring in speech communication does indeed provide those skills, this form
of stereotyping can be beneficial. Common attributes from which people often
stereotype are race and sex. Of course, stereotypes along these lines are inaccurate and can be harmful. For example, suppose a human resource manager
forms the stereotype that women can only perform certain tasks and that men
are best suited for other tasks. To the extent that this affects the manager’ s
hiring practices, he or she is (1) costing the organization valuable talent for
both sets of jobs, (2) violating federal law, and (3) behaving unethically.
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
Errors in Perception
As you might expect, errors may creep into how we interpret the things we
perceive. Stereotyping and selection perception are often the underlying
causes of these errors , but other factors ma y also come into pla y. Perception shortcuts, for example, may play a role. One perception shortcut is categorization, which reflects our tendency to put things into groups or categories ­
(e.g., Southerner, energetic, athlete, etc.). We then exaggerate the similarities
within and the differences between the groups. This explains our tendency to
see members of a particular group to whic h we do not belong as being more
alike than they actually are. Have you ever seen someone work quic kly and
thought to yourself how good he or she is at that job? If so , you may have put
that person into a “high performer” category.
After we put people into categories, selective perception leads to ­selectively
interpreting what we see based on our interests, expectations, experience, and
attitudes. Once we categorize someone (a cashier named Sue, for our running
example) as a high performer, we focus more on (and will better remember)
information related to her high performance, and we tend to disregard information reflecting her low performance. If we saw Sue make an error on the cash
register, we might discount it by attributing it to a fluke or to a problem with
the machine, and focus only on her superior item-scanning speed. Selective
perception reinforces stereotypes as the perceiver focuses on information and
behaviors that confirm rather than negate the assigned stereotype . A supervisor who believes that a subordinate has high potential will interpret what is
observed through that positively biased lens, while a supervisor who believes
a subordinate has low ability will interpret the same information negatively to
reinforce expectations of low performance. Managers need to be a ware of this
bias in order to evaluate subordinates more objectively and accurately.
The halo effect is when we form a general impression about something or
someone based on a single (typically good) characteristic. For example, people
tend to associate beauty with other positive characteristics. We often assume
that physically attractive people possess more socially desirable personalities
than less beautiful people do, and that they lead happier and more successful
lives.57 Similarly, because you perceive Sue to be a high performer, you might
assume that she is also intelligent, energetic, or whatever else you associate
with high performers.
The contrast effect occurs when we evaluate our own or another person’s
characteristics through comparisons with other people we ha ve recently
encountered who rank higher or lower on the same c haracteristics. After
encountering Sue, if we see an a verage cashier, we might evaluate him as
below average because we thought so highly of Sue’ s performance. The contrast effect is common among college students who—because they are used to
being around people who have relatively high intelligence and ambition compared to the general public, and because they compare themselves to other
smart, motivated people—conclude that they are only average when, in fact,
they are above a verage. Projection occurs when we project our own c haracteristics onto other people. If a hiring manager is interviewing someone who
reminds him of himself when he was just starting out, he may assume that the
candidate also shares his values, work ethic, and abilities.
First impression bias may also be relevant. Research has found that not
only do we tend to a void people after we ha ve had a negative reaction to
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139
140
PART 2 | Individual Behaviors and Processes in Organizations
First impressions are formed quickly. Take this new employee, for
instance. He is being introduced to his new colleagues during his first
day at work. He will quickly form impressions of them just as they
form impressions of him. First impression bias, though, may result in
inaccurate impressions which may then be hard to overcome.
STUART
JENNE
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them, 58 but also negative impressions
are harder to c hange than positive
ones. 59 F irst impressions are formed
quickly. If you find yourself making negative assumptions about someone you have
just met, it can be a good idea to quic kly
look for positive information that discon firms your negative assumptions before
they become too strongly held. Our social
perceptions can obviously be flawed—even
the most skilled observers can misperceive
and misjudge others. Once we form wrong
impressions, they are likely to persist. When
we have the motivation and the resources
to think carefully about something, we usually will, but even then the various cognitive
biases can influence our perceptions.
Our impressions and expectations of others also can become self-fulfilling
prophecies. If we categorize a person as untrustworthy, we are likely to treat
that individual with suspicion and distrust. These actions then evoke appropriate guarded reactions from the other person, whose reactions serve to confirm our initial impressions. One of the first experiments on the self-fulfilling
prophecy effect in work settings was conducted in a job training program for
disadvantaged employees.60 Trainees labeled “high aptitude” (though ran domly selected) achieved more on objective tests, were rated higher by their
supervisors and peers, and had lower dropout rates than the trainees who
were not labeled in that way. Self-fulfilling prophecies are widespread in organizations. High expectations have a stronger effect on disadvantaged groups
or those stereotyped as low achievers, and on people who are unsure of their
abilities in a particular situation.61 Self-fulfilling prophecies also seem to work
best in newly established relationships.
Perception and Attribution
attribution
The way we explain
the causes of our
own as well as other
people’s behaviors
and achievements, and
understand why people
do what they do
Have you ever noticed that when classmates do well on a test, they often attribute it to their own effort and ability, but when they learn that you did well,
they seem to attribute it more to luck or to easy grading by the instructor? This
tendency is a perfectly normal outcome of attributions. Attribution refers to
the way we explain the causes of our own as well as other people’ s behaviors
and achievements, and understand why people do what they do.62 Our job performance and even our ultimate survival in an organization often depend on
the accuracy of our attributions for our own and supervisor, coworker, and customer behaviors and outcomes.
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141
U N D E R S TA N D Y O U R S E L F
POSITIVE AND NEGATIVE AFFECTIVITY
strongly
disagree
disagree
neutral
agree
strongly
agree
___ 8. Attentive
___ 9. Afraid
1
2
3
4
5
Using the scale above, and thinking about yourself and
how you usually feel, indicate before each item below to
what extent you generally feel:
___ 1. Upset
___ 2. Hostile
___ 3. Alert
___ 4. Ashamed
___ 5. Inspired
___ 6. Nervous
___ 7. Determined
___ 10. Active
Scoring: Add up your scores for items 3, 5, 7, 8,
and 10. This is your positive affectivity score. Now add
up your scores for items 1, 2, 4, 6, and 9. This is your
negative affectivity score.
Interpretation: If your positive affectivity score is
greater than 19.7, it is above average compared to a
sample of 411 U.S. undergraduates. If your negative
affectivity score is greater than 11.3, it is above average
compared to the same sample of 411 U.S. undergraduates. To reduce your negative affectivity, try to think more
positively and focus on those things for which you can be
grateful. Keeping a gratitude journal can help you reflect
positively on the things that happen in your life.
Source: Thompson, E. R., Development and validation of an internationally
reliable short-form of the positive and negative affect schedule (PANAS),
Journal of Cross-Cultural Psychology, 38(2), 227–242. © 2007 by SAGE
Publications. Reprinted by Permission of SAGE Publications.
The strongest attribution people tend to make is whether their own or others’ behaviors or outcomes are due to the individual (internal factors) because
of things like effort or ability or to the environment (external factors) because
of things like luck, a lack of resources, or other people. As shown in Figure 4.5,
we rely on three rules to evaluate whether to assign an internal or an external
attribution to someone’s behavior or outcome:63
1. Consistency: Has the person r egularly behaved this way or experienced
this outcome in the past? If your roommate consistently earns good grades
in a subject, you are more likely to attribute a recent high test grade to
an internal cause like ability or effort. If his or her grades earlier in the
semester have been lower, you are more likely to attribute the grade to an
external cause like luck. Consistency leads to internal attributions.
2. Distinctiveness: Does the person act the same way or receive similar outcomes in different types of situations? Low distinctiveness occurs when
the person frequently acts in a certain way or receives certain outcomes
and leads to internal attributions. If your roommate is a straight-A student, the distinctiveness of his or her recent high grade would be low, and
you would make internal attributions for it. If your roommate is a C stu dent, the distinctiveness of the recent high grade would be high and you
would attribute it to external causes.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
142
PART 2 | Individual Behaviors and Processes in Organizations
Figure 4.5
The attribution process
involves observing
behavior and then
attributing causes to it.
Observed behaviors
are interpreted in terms
of their consensus, their
consistency, and their
distinctiveness. Based
on these interpretations,
behavior is attributed to
either internal or external
causes.
The Attribution Process
Consensus
(High or Low)
Observation
of Behavior
Consistency
(High or Low)
Attribution of Causes
(Internal or External)
Distinctiveness
(High or Low)
3. Consensus: Would others behave similarly in the same situation, or receive
the same outcome? If almost everyone earns an A in the course in which
your roommate just did well, consensus would be high and you would
make external attributions for your roommate’s grade. If consensus is low
and few students do well in the c lass, you would make internal attribu tions for the grade.
ventdusu
d/Shutte
rstock.co
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A related aspect of attribution is self-handicapping . Self-handicapping
occurs when people create obstac les for themselves that make success less
likely. Examples include using drugs and alcohol, refusing to practice, and
reducing effort. Creating these impediments obviously decreases motivation
and performance. These behaviors may sound
silly, but they are very real and serve to pro tect the person’s sense of self-competence. If a self-handicapping
person does poorly, the obstac le
creates an easy explanation for
the failure. If the person succeeds
in spite of the obstacle, the success
seems even greater.
Self-handicapping occurs when people create
obstacles for themselves that make success less
likely. This man, for example, is having a drink
while working. Alcohol, in turn, may affect his
performance and lead to bad decisions. Even if
he doesn’t drink too much, others who observe
his behavior may start to question his judgment.
In either case he may be hurting his chances for
a promotion.
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
143
Students sometimes use self-handicapping attributions, perhaps by not
studying for a test. They might feel that:
•
•
•
•
If they study hard and give it their best shot but fail, they will look and
feel incompetent.
If they study hard and pass , the hard work will reduce the meaning of
the success. (If they were really smart, they would not have had to work so hard.)
If they do not study and fail, the failure can be easily explained by the lack of
effort. They can still believe that they could have succeeded if they had really
tried. Even if they fail the test, no one will have evidence that they are stupid.
If they do not study but still manage to succeed, then the only explanation
for the success is that they have really high ability.
This kind of reasoning is obviously counterproductive , because someone
who expends less effort is obviously less likely to succeed. Self-handicapping
tends to emerge during adolescence among persons with a high concern about
looking competent. Focusing on effort attributions and developing feelings of
self-efficacy help overcome this behavior.
As a manager, understanding that a subordinate’ s own perceptions or
attributions for success or failure determine the amount of effort he or she will
expend on that activity in the future is a powerful motivational tool. Employees’ perceptions and attributions determine the amount of effort they will
exert on that activity in the future , and those attributions may differ across
people. An employee may believe that she expended a great deal of effort when
in fact she did not, or perceive an objectively easy task to be difficult. Attributing success to internal causes builds self-efficacy and increases the motivation
to try hard and persist in the face of failure.
Perception and Fairness, Justice, and Trust
GLOBAL
ISSUES
HOW CULTURE CAN INFLUENCE ATTRIBUTIONS
In intercultural interactions, the interpretations of
­b ehaviors are often more important than the actual
behaviors themselves.64 Because Western cultures emphasize individual freedom and autonomy, people in these
cultures prefer dispositional explanations, while people
from collectivist cultures that emphasize group membership and conformity to group norms tend to prefer situational explanations.65
One study showed American and Chinese ­participants
a picture of an individual fish swimming in front of a
group of fish. More American than Chinese participants
attributed the individual fish’s behavior as internally rather
than externally caused.66 This attributional difference may
be due to the way people with different cultural orientations perceive themselves in their environment. Westerners,
who tend to be more individualistic, often see themselves
as independent entities and therefore tend to notice individual objects more than contextual details.67
Understanding a coworker’s behavior requires understanding his or her subjective culture. Attributional training
can help us understand the appropriate attributions for the
behaviors of diverse coworkers.
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Perception and perceptual processes play a major role in how people feel about
fairness, justice, and trust. Think of a time when you felt unfairly treated at work
or school. Why did you feel that way? What did you do about it? When we perceive
144
PART 2 | Individual Behaviors and Processes in Organizations
organizational fairness
Refers to employees’
perceptions of
organizational events,
policies, and practices as
being fair or not fair
unfairness, we are often motivated to do something about it.In organizations, perceptions of unfairness (also referred to as injustice) can exist in numerous situa tions. Layoffs and downsizings are often seen as unfair by those dismissed as well
as by the employees who remain. Hiring and promotion decisions are often seen
as unfair by those not c hosen. In unionized settings, both managers and union
representatives often perceive the other to be unfair. Even organizational change
can be viewed as unfair by those asked to learn new systems or do new things.
The term organizational fairness refers to employees’ perceptions of
organizational events, policies, and practices as being fair or not fair. 68 Fairness is a primary concern in relationships where subordinates must rely on
others in higher positions.69 Why should you care about fairness? You should
care because perceptions of fairness affect a wide variety of employee atti tudes and behaviors including satisfaction, commitment, trust, and turnover.
A number of negative beha viors can result from perceptions of unfairness ,
including theft, sabotage, and other unethical behaviors.70 Perceived unfairness also increases the chances that employees will file lawsuits against their
employers.71 Most of these outcomes of fairness perceptions can ha ve an obvious economic impact on organizations.
As a manager, it is critical to remember that it is insufficient to justbe fair;
you must also be perceived as fair by your subordinates. Perceptions are what
drive responses, and subordinates’ attributions and interpretations of your
behaviors and decisions may not reflect your intentions or your own beliefs .
The demographic diversity of the U.S. workforce requires many managers to
handle differences among employees regarding characteristics ranging from
ethnicity to religion to political ideology—all of which can be a source of conflict and misunderstanding.72 Effectively managing organizational fairness
perceptions and attributions can help managers prevent or effectively manage
any conflict or misunderstandings that occur.
Understanding fairness is important for ethical reasons as well. 73 There
has been no shortage of high-profile ethical lapses in recent years , ranging
from Enron to Bernie Madoff to mortgage fraud. Training all employees, including company leaders, in organizational fairness principles helps guide them
in making ethical decisions. When employees perceive general organizational
fairness and an organizational desire to follow through on formal ethics programs, unethical behavior is reduced and employees are more willing to report
problems to management.74 Also, individuals’ expectations for fairness produce
expectations that those who violate ethical expectations will be disciplined. 75
Failure to meet employees’ fairness expectations can lead them to engage in
unethical behavior.76 We think of fairness in three main ways, discussed next.
distributive fairness
Refers to the perceived
fairness of the outcome
received, including
resource distributions,
promotions, hiring and
layoff decisions, and
raises
Distributive Fairness
Distributive fairness refers to the perceived fairness of the outcome received,
including resource distributions, promotions, hiring and layoff decisions, and
raises.77 Imagine that you and a friend both apply for a job with a local company at the same time. Although you believe that you are more qualified, your
friend is offered a job and you are not. Would this feel fair? Your belief about
the fairness of you not getting the job reflects your perception of distributive
fairness. Distributive fairness relates only to the outcome received, not to the
fairness of the process that generated the decision.
procedural fairness
Addresses the fairness of
the procedures used to
generate the outcome
Procedural Fairness
A fair process is as important as a fair outcome . Procedural fairness
addresses the fairness of the procedures used to generate the outcome
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
145
(e.g., what rules were followed, whether people had the opportunity to express
opinions and influence the outcome, etc.).78 For example, let’s continue the
example of your applying for a job at t he same time as your friend but your
friend getting the position. What if you learned that the hiring manager is
your friend’s cousin, so your friend was offered the job even though you were
more qualified? Bending the rules for a relative would probably violate your
standards for what constitutes a fair hiring procedure . Low procedural fairness increases negative outcomes, such as lower job performance and with drawal behaviors like coming to work late or putting in less effort. But if
procedural fairness is high, negative reactions are much less likely. Why does
procedural fairness matter so much? There are two reasons.79 First, employees
use perceptions of the current decision-making procedures to predict how they
will likely fare in the organization in the future. Second, fair procedures signal
that employees are valued and accepted by the organization.
Interactional Fairness
Interactional fairness is whether the amount of information about the decision and the process w as adequate, and the perceived fairness of the inter personal treatment and explanations received during the decision-making
process. Does an employee who did not receive a performance bonus feel that
the supervisor adequately explained the reason? When we assess undesirable
outcomes, how we are treated can be just as important as the outcomes we
receive. It is difficult to give our best effort to someone who treats us rudely
or disrespects us. Deception or abusive words or actions can be seen as having
low interactional fairness.80
Interactional fairness describes two specific types of interpersonal treat ment.81 The first type is interpersonal fairness , which reflects the degree to
which people are treated with politeness, dignity, and respect by authorities or
third parties involved in executing procedures or determining outcomes. The
second type is informational fairness , which focuses on the extent to whic h
employees receive adequate information and explanations about decisions
affecting their working lives.82 It is important that a high degree of interactional fairness exist in the relationship between a supervisor and a subor dinate. Low interactional fairness can lead to feelings of resentment tow ard
either the supervisor or the organization.83 A victim of interactional unfairness often has increased expressions of hostility tow ard the supervisor or
company, which can lead to negative work beha viors and decrease the effectiveness of organizational communication.84 Explanations increase job applicants’ fairness perceptions, perceptions of the hiring organization, test-taking
motivation, and performance on cognitive ability tests.85
Perception and Trust
One of the most important outcomes of consistently treating others fairly
is trust. Trust is the expectation that another person will not act to take
­advantage of us regardless of our ability to monitor or control them.86 Trust is
critical to long-term relationships and is positively related to job performance . 87
Trusting work relationships enable employees to focus on their work and not
waste time and energy “watching their backs.” Trust is particularly important
to the developmental stages of relationships ,88 and is positively related to a
company’s financial performance.89 One survey of 500 business professionals
found that having a trusting relationship with one’ s manager was the main
factor in deciding to stay.90
interactional fairness
Whether the amount of
information about the
decision and the process
was adequate, and the
perceived fairness of the
interpersonal treatment
and explanations
received during the
decision-making process
trust
The expectation that
another person will not
act to take advantage
of us regardless of our
ability to monitor or
control them
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
PART 2 | Individual Behaviors and Processes in Organizations
CASE STUDY
What to Do When the Boss
Releases His Inner Toddler
Put yourself in the following scenario:
You’re one of 10 VPs at a small chain of regional
clothing stores, where you’re in charge of the
women’s apparel departments. One of your jobs
is to review each month’s performance at a meeting of all 10 department heads and the company
president. Like your fellow VPs, you prepare a
PowerPoint presentation showing the results for
the previous month and your projections for the
upcoming month, and during your presentation
you take the podium and lead the discussion from
the front of the room.
On the whole, the meeting is part of a pretty
sound overall strategy that allows everyone to
know what’s going on and what to expect across
the board. Typically, the only drawback to an
informative and productive session is the president’s apparent inability to deal with bad news.
He gets irritable and likes to lambaste “underperformers,” and as a result, you and your colleagues always enter the meeting with stomachs
in knots and leave it with full-blown gastric distress. The president himself thinks he’s fostering
open and honest discussion, but everyone else in
the room knows plain old-fashioned bullying
when they see it.
As luck would have it, you now find yourself
at the front of the room, looking up at the floor-toceiling screen on which are emblazoned, in what
looks to you like 500-point font (red, of course),
your less than stellar monthly numbers. Sweating
profusely, you’re attempting to explain some disappointing sales figures when you hear a noise—
a sort of thudding and rattling—against the wall
behind you. Startled, you spin around toward the
room and are surprised to see that everyone
seems to be looking for something on the floor or
checking the weather through the windows on
one side of the room. Finally you glance toward
the wall behind you, where you discover a bent
meeting-room chair lying on the floor, and as you
look up again, you see that the president is standing, his arms crossed and his face scowling. “The
next time you show me numbers like those,” he
snarls, “I won’t miss!”
Believe it or not, this is a true story (although
we’ve changed a few details—very few—in the
interest of plausibility and dramatic impact). It’s
told by John McKee, a consultant to professionals
and businesspeople who want to move up the
management ladder as quickly—and, presumably, with as little violence—as possible. McKee
was actually an eyewitness to the episode, and
although he admits that it’s “the clearest example
of a boss behaving badly” that he’s ever seen, he
hastens to add that he won’t be the least bit surprised when someone comes up with an even better one.
Consultant Lynn Taylor, who specializes in the
development of work and management teams,
calls bosses like the one in our scenario Terrible
Office Tyrants, or TOTs—managers who can’t
control their power when they’re placed under
stress. Taylor believes that the characterization is
apt in light of research showing that bosses like
the one we’ve described actually “return to their
misbehaving ‘inner toddler’ to handle unwieldy
pressures.” In other words, they revert to the kind
of behavior that produced “self-serving results”
when they were children. In the adult workplace,
explains Taylor, they “occasionally find that their
ability to master the world is limited, as it is with
most mortal beings. This revelation, on top of their
inability to communicate clearly in the moment,
makes them furious and frustrated.”
According to Taylor, there are 20 “core, parallel traits [shared by] TOTs and toddlers.” The following, which are fairly aggressive, she catalogs
under “Bratty Behavior”:
•
•
•
•
•
•
•
•
•
•
•
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Bragging
Bullying
Demanding
Ignoring
Impulsiveness
Lying
Self-centeredness
Stubbornness
Tantrums
Territorialism
Whining
“Most tantrums,” Taylor assures us, “don’t involve
things being thrown across the room,” and TOT
behavior, especially in its less aggressive forms—
fickleness, mood swings, neediness—can be “proactively managed” by employees who don’t care
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 4 | Individual Values, Perceptions, and Reactions
CASE STUDY
(Continued)
to be treated as emotional punching bags. She
recommends “humor, common sense, rational
thinking, and setting limits to bad behavior.” And
remember, she adds, “You are the parent with the
proverbial cookie jar when it comes to managing
a TOT.”
Taylor’s approach to understanding and dealing
with bad bosses isn’t entirely metaphorical, and she
does suggest that beleaguered employees translate
her general advice into some concrete coping techniques. When confronted by managerial neediness,
for example, a good “pacifier” might be a reply
such as: “It’ll be the first thing on my to-do list tomorrow.” If you’re looking for a handy toolbox of effective techniques, you can find dozens on the Internet,
most of them posted by psychologists and organizational consultants. The following was compiled by
Karen Burns, U.S. News columnist and specialist on
career advice for women:
inside the workplace and someone outside to
talk (and vent) to.
• Control what you can. You can’t control your
boss’s irrational behavior, so control what
you can—namely, the way you respond to it.
Ignore the cranky tone of voice and respond
to the substance of what she says. Also, eat
right, exercise, get enough sleep, and spend
the rest of your time with sane people.
• Know your rights. If you want to take your
grievance to the HR department (or further),
be sure that you’ve documented your problem
and your efforts to resolve it, and be specific
about the remedy you’re asking for (transfer,
severance package, etc.).
• Identify the exits. Come up with a plan, and
don’t be bullied into taking action before
you’re ready.
• Put everything in writing. Write and date
Questions
progress reports. When you get verbal instructions, summarize them in a reply e-mail.
• Be a star performer. Beyond just being a good
employee, maintain a positive demeanor; it’s
hard for someone to ambush you when you’re
doing your job and smiling in the process.
• Pick your moments. Rather than simply avoiding your boss, study her patterns. Steer clear
when she’s a nutcase and schedule interactions for times when she’s stabilized.
• Seek community. Anchor your sanity in ties to
coworkers and other managers. Find a mentor
1. According to some experts, the sort of behavior recorded here is more prevalent in the
business world than in the rest of society.
Assuming that this is true, why do you suppose that’s the case?
2. Are you something of a perfectionist? Are you
easily frustrated? How well suited are you—at
this point in your life—to the task of managing
other people?
3. How might attitudes, values, and perceptions
affect the behaviors illustrated in this case?
4. How would stress come into play?
Sources: McKee, J. (2007, Feruary 8). Worst Boss Ever. TechRepublic. Available at http://www.techrepublic.com/blog/careermanagement/worst-boss-ever/; Taylor, L. (2009, August 27). Why Bad Bosses Act Like Toddlers. Psychology Today. Available
at https://www.psychologytoday.com/blog/tame-your-terrible-office-tyrant/200908/why-bad-bosses-act-toddlers; Taylor, L.
(2009, December 15). 10 Ways to Manage Bad Bosses. CNN Living. Available at http://www.cnn.com/2009/LIVING/
worklife/12/14/bad.bosses.deal.with.cb/; Burns, K. (2009, November 4). How to Survive a Bad Boss. U.S. News & World
Report. Available at http://money.usnews.com/money/blogs/outside-voices-careers/2009/11/04/how-to-survive-a-bad-boss.
STRESS IN ORGANIZATIONS
The finally element of individual behavior we will discuss in this chapter is
stress. Many people think of stress as a simple problem. In reality, however,
stress is complex and often misunderstood.91 To learn how job stress truly works,
we must first define it and then describe the process through which it develops.
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147
148
PART 2 | Individual Behaviors and Processes in Organizations
Stress affects different people in different ways. This man,
for example, seems to be very stressed about his work.
However, none of his coworkers seem to be experiencing
the same degree of stress. Of course, it may also be the
case that his stress is unrelated to work but instead comes
from other sources.
The Nature of Stress
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Stress has been defined in many ways, but
most definitions sa y that stress is caused
by a stimulus , that the stimulus can be
either physical or psychological, and that
the individual responds to the stimulus in
some way. 92 Therefore, we define stress a s
a person’s adaptive response to a stimulus
that places excessive psychological or physical
demands on him or her.
Given the underlying complexities of this
definition, we need to examine its components
carefully. First is the notion of adaptation. As we
discuss presently, people may adapt to stressful
circumstances in any of several ways. Second is the role of the stimulus. This stimulus, generally called a stressor, is anything that induces stress.
Third, stressors can be either psychological or physical. Finally, the demands
the stressor places on the individual must be excessive for stress to actually
result. Of course, what is excessive for one person ma y be perfectly tolerable
for another. The point is simply that a person must perceive the demands as
excessive or stress will not actually be present.
There has been a marked increase in stress reported by airline workers
in the last few years. A combination of increased pressure for salary and ben efit reductions, threats to pensions, demotions, layoffs, and heavier workloads
have all become more pronounced since September 11. And today’s rising
energy prices are likely to increase these pressures. As a result, more airline
workers than ever before are seeking counseling services; turnover and absenteeism are also on the rise.93
stress
A person’s adaptive
response to a stimulus
that places excessive
psychological or physical
demands on that person
general adaptation
syndrome (GAS)
Identifies three stages of
response to a stressor:
alarm, resistance, and
exhaustion
The Stress Process
Much of what we know about stress today can be traced to the pioneering work
of Hans Selye.94 Among Selye’s most important contributions were his identi fication of the general adaptation syndrome and the concepts of eustress and
­distress. Figure 4.6 offers a graphical representation of thegeneral ­adaptation
syndrome (GAS). According to this model, each of us has a normal level of
resistance to stressful events. Some of us can tolerate a great deal of stress and
others much less, but we all have a threshold at which stress starts to affect us.
The GAS begins when a person first encounters a stressor. The first stage
is called “alarm.” At this point, the person may feel some degree of panic and
begin to wonder how to cope. The individual may also have to resolve a “fightor-flight” question: “Can I deal with this, or should I run away?” For example,
suppose a manager is ordered to prepare a lengthy report overnight. His first
reaction might be, “How will I ever get this done by tomorrow?”
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 4 | Individual Values, Perceptions, and Reactions
149
Figure 4.6
The General Adaptation System
Individual’s Resistance to Stress
High
Response to
Stressful Event
Normal Level
of Resistance
Low
Stage 1:
Alarm
Stage 2:
Resistance
Stage 3:
Exhaustion
The general adaptation
syndrome (GAS)
perspective describes
three stages of the stress
process. The initial
stage is called alarm.
As illustrated here, a
person’s resistance often
dips slightly below the
normal level during
this stage. Next comes
actual resistance to the
stressor, usually leading
to an increase above
the person’s normal level
of resistance. Finally, in
stage 3, exhaustion may
set in, and the person’s
resistance declines
sharply below normal
levels.
If the stressor is too extreme , the person ma y simply be unable to cope
with it. In most cases , however, the individual gathers his or her strength
(physical or emotional) and begins to resist the negative effects of the stressor.
The manager with the long report to write ma y calm down, call home to tell
her kids that she’s working late, roll up her sleeves, order out for dinner, and
get to work. Thus, at stage two of the GAS, the person is resisting the effects
of the stressor.
Often, the resistance phase ends the GAS. If the manager completes the
report earlier than she expected, she may drop it in her briefcase, smile to herself, and head home tired but happy. On the other hand, prolonged exposure to
a stressor without resolution may bring on phase threeof the GAS: exhaustion.
At this stage, the person literally gives up and can no longer fight the stressor.
For example, the manager may fall asleep at her desk at 3 a.m. and fail to finish the report.
Distress and Eustress
Selye also pointed out that the sources of stress need not be bad. For ­example,
receiving a bonus and then having to decide what to do with the money can
be stressful. So can getting a promotion, making a speech as part of winning
a major award, getting married, and similar “good” things. Selye called this
type of stress eustress. As we will see later, eustress can lead to a number of positive outcomes for the individual. Of course, there is also negative
stress. Called distress, this is what most people think of when they hear
the word stress. Excessive pressure, unreasonable demands on our time, and
bad news all fall into this category. As the term suggests, this form of stress
generally results in negative consequences for the individual. For purposes
of ­simplicity, we will continue to use the simple term stress throughout this
chapter. As you read and study the c hapter, remember that stress can be
either good or bad. It can motivate and stimulate us , or it can lead to any
number of dangerous side effects.
eustress
The pleasurable stress
that accompanies positive
events
distress
The unpleasant stress that
accompanies negative
events
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150
PART 2 | Individual Behaviors and Processes in Organizations
Common Causes of Stress
Many things can cause stress. Figure 4.7 shows two broad categories: organizational stressors and life stressors. It also shows three categories of stress
consequences: individual consequences, organizational consequences, and
burnout.
organizational
stressors
factors in the workplace
that can cause stress
Organizational Stressors
Organizational stressors are various factors in the workplace that can
cause stress. Four general sets of organizational stressors are task demands,
physical demands, role demands, and interpersonal demands.
Task d emands a re s tressors a ssociated w ith t he s pecific j ob a p erson performs. Some occupations are by nature more stressful than others .
For instance, the job of br ain surgeon is likely to be in herently stressful.
Unhealthy conditions exist in occupations such as coal mining and toxic waste
handling. Lack of job security is another task demand that can cause stress.
Someone in a relatively secure job is not likely to worry unduly about losing
that ­position; however, threats to job security can increase stress dramatically.
Figure 4.7
The causes and
consequences of stress
are related in complex
ways. As shown
here, most common
causes of stress can
be classified as either
organizational stressors
or life stressors. Similarly,
common consequences
include individual
and organizational
consequences, as
well as burnout.
Causes and Consequences of Stress
Organizational
Stressors
Task Demands
Occupation
Security
Overload
Physical Demands
Temperature
Office Design
Role Demands
Ambiguity
Conflict
Interpersonal Demands
Group Pressures
Leadership Style
Personalities
Individual
Consequences
Behavioral
Alcohol and Drug Abuse
Violence
Psychological
Sleep Disturbances
Depression
Medical
Heart Disease
Headaches
Organizational
Consequences
Life Stressors
Decline in Performance
Absenteeism and Turnover
Decreased Motivation and
Satisfaction
Life Change
Life Trauma
Burnout
Reference: Adapted from James C. Quick and Jonathan D. Quick, Organizational Stress and Preventive Management (McGraw-Hill, 1984) pp. 19, 44, and 76. Used by permission of James C. Quick.
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
151
Organizational stressors are factors in the workplace that can cause
stress. Task, physical, role, and interpersonal demands are all types of
organizational stressors. This man, for example, may be stressed because
he is behind on a project, just had a disagreement with his boss or
coworkers, has been working too many hours, or is working
in a hot office with no air conditioning.
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For e xample, s tress g enerally i ncreases
throughout an o­ rganization during a period
of layoffs or ­immediately after a merger with
another firm. A final task demand stressor is
overload. Overload occurs when a person simply
has more work than he or she can handle . The
overload can be either quantitative (the person
has too many tasks to perform or too little time
to perform them) or qualitative (the person may
believe he or she lacks the ability to do the job).
We should note that the opposite of overload ma y
also be undesirable. As Figure 4.8 shows, low task
demands can result in boredom and apathy just
as overload can cause tension and anxiety. Thus, a
moderate degree of workload-related stress is optimal, because it leads to high levels of energy and
motivation.
The physical demands of a job are its physical requirements on the worker;
these demands are a function of the physical characteristics of the setting and
the physical tasks the job involves . One important element is temperature .
Figure 4.8
Workload, Stress, and Performance
Too much stress is clearly
undesirable, but too little
stress can also lead to
unexpected problems.
For example, too little
stress may result in
boredom and apathy
and be accompanied
by low performance.
And although too
much stress can cause
tension, anxiety, and
low performance, for
most people there is an
optimal level of stress
that results in high
energy, motivation, and
performance.
High
Performance
Optimal
Workload
Boredom
Apathy
Low
High Energy
High Motivation
Tension
Anxiety
High
Low
Workload-Induced Stress
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152
PART 2 | Individual Behaviors and Processes in Organizations
Working outdoors in extreme temperatures can result in stress, as can working in an improperly heated or cooled office . Strenuous labor suc h as loading heavy cargo or lifting packages can lead to similar results. Office design
can be a problem, as well. A poorly designed office can make it difficult for
people to have privacy or promote too much or too little social interaction. Too
much interaction may distract a person from his or her task, whereas too little
may lead to boredom or loneliness. Likewise, poor lighting, inadequate work
surfaces, and similar deficiencies can create stress. Shift work can cause disruptions for people because of the w ay it affects their sleep and leisure-time
activities.
Role demands can also be stressful to people in organizations. A role is
a set of expected beha viors associated with a particular position in a group
or organization. As such, it has both formal (i.e., job-related and explicit) and
informal (i.e., social and implicit) requirements. People in an organization or
work group expect a person in a particular role to act in certain ways. They
transmit these expectations both formally and informally. Individuals perceive role expectations with varying degrees of accuracy and then attempt
to enact that role. However, “errors” can creep into this process, resulting in
stress-inducing problems called role ambiguity, role conflict, and role overload.
A final set of organizational stressors consists of three interpersonal
demands: group pressures, leadership, and interpersonal conflict. Group pressures may include pressure to restrict output, pressure to conform to the group’s
norms, and so forth. For instance, it is quite common for a workgroup to arrive
at an informal agreement about how much each member will produce. Individuals who produce much more or much less than this level may be pressured by
the group to get back in line. An individual who feels a strong need to vary from
the group’s expectations (perhaps to get a pay raise or promotion) will experience a great deal of stress, especially if acceptance by the group is also important to him or her. Leadership style also may cause stress. Suppose an employee
needs a great deal of social support from his leader. The leader, however, is quite
brusque and shows no concern or compassion for him. This employee will probably feel stressed. Similarly, assume an employee feels a strong need to par ticipate in decision making and to be active in all aspects of management. Her
boss is very autocratic and refuses to consult subordinates about anything. Once
again stress is likely to result. Conflicting personalities and behaviors may also
cause stress. Conflict can occur when two or more people must work together
even though their personalities, attitudes, and behaviors differ. For example, a
person with an internal locus of control—that is , who always wants to control
how things turn out—might get frustrated working with a person with an external locus who likes to wait and just let things happen. Likewise, an employee
who likes to have a quiet and peaceful work environment may experience stress
if the adjacent office is assigned to someone whose job requires him or her to
talk on the telephone much of the day.95
Finally, we should also note that in today’s world many job holders experience stress from a variety of sources simultaneously. One clear example is
an airport security screener. These individuals must deal with myriad carryon articles, some of them potentially dangerous . They face pressure from
travelers to perform their job as quickly as possible but also are constantly
reminded of the potential consequences of an error . Indeed, many individuals involved in security-related jobs face higher stress levels today than
ever before. It is also the case that stress in organizational settings can be
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
influenced by events that take place outside the organization. An individual
dealing with financial problems, a sick child, or the death of a close family
member will undoubtedly experience stress from those events . And understandably, an individual facing these and similar issues outside of work will
still be affected by them while at work.
Consequences of Stress
Stress can have a number of consequences. As we already noted, if the stress is
positive, the result may be more energy, enthusiasm, and motivation. Of more
concern, of course, are the negative consequences of stress. Referring back to
Figure 4.7, we see that stress can produce individual consequences , organizational consequences, and burnout. We should first note that many of the
factors listed are obviously interrelated. For example, alcohol abuse is shown
as an individual consequence, but it also affects the organization the person
works for. An employee who drinks on the job may perform poorly and create a
hazard for others. If the category for a consequence seems somewhat arbitrary,
be aware that each consequence is categorized according to the area of its pri mary influence.
Individual Consequences
The individual consequences of stress , then, are the outcomes that mainly
affect the individual. The organization also may suffer, either directly or indirectly, but it is the individual who pays the real price.96 Stress may produce
behavioral, psychological, and medical consequences.
The behavioral consequences of stress may harm the person under stress
or others. One such behavior is smoking. Research has clearly documented that
people who smoke tend to smoke more when they experience stress . There is
also evidence that alcohol and drug abuse are linked to stress, although this
relationship is less well documented. Other possible behavioral consequences
are accident proneness, aggression and violence, and appetite disorders. The
psychological consequences of stress relate to a person’s mental health and
well-being. When people experience too much stress at work, they may become
depressed or find themselves sleeping too much or not enough. 97 Stress may
also lead to family problems and sexual difficulties. The medical consequences
of stress affect a person’s physical well-being. Heart disease and stroke, among
other illnesses, have been linked to stress . Other common medical problems
resulting from too much stress include headaches, backaches, ulcers and related
stomach and intestinal disorders, and skin conditions such as acne and hives.
Organizational Consequences
Clearly, any of the individual consequences just discussed can also affect the
organization. Other results of stress have even more direct consequences for
organizations. These include decline in performance, withdrawal, and negative
changes in attitudes.
One clear organizational consequence of too much stress is a decline in
performance. For operating workers, such a decline can translate into poorquality work or a drop in productivity . For managers, it can mean faulty
decision making or disruptions in working relationships as people become
irritable and hard to get along with. 98 Withdrawal beha viors also can
result from stress. For the organization, the two most significant forms of
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153
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PART 2 | Individual Behaviors and Processes in Organizations
burnout
A general feeling
of exhaustion that
develops when an
individual simultaneously
experiences too much
pressure and has too few
sources of satisfaction
withdrawal behavior are absenteeism and quitting. People who are having
a hard time coping with stress in their jobs are more likely to call in sic k
or consider leaving the organization for good. Stress can also produce other,
more subtle forms of withdrawal. A manager may start missing deadlines or
taking longer lunch breaks. An employee may withdraw psychologically by
ceasing to care about the organization and the job. As noted above, employee
violence is a potential individual consequence of stress. This also has obvious
organizational implications, especially if the violence is directed at another
employee or at the organization in general. 99 Another direct organizational
consequence of employee stress relates to attitudes . As we just noted, job
satisfaction, morale, and organizational commitment can all suffer , along
with motivation to perform at high levels . As a result, people may be more
prone to complain about unimportant things, do only enough work to get by,
and so forth.
Burnout, another consequence of stress, has clear implications for both
people and organizations. Burnout is a general feeling of exhaustion that
develops when a person simultaneously experiences too muc h pressure and
has too few sources of satisfaction.100 People with high aspirations and strong
motivation to get things done are prime candidates for burnout under certain
conditions. They are especially vulnerable when the organization suppresses
or limits their initiative while constantly demanding that they serve the organization’s own ends.
In such a situation, the individual is likely to put too much of himself or
herself into the job. In other words, the person may well keep trying to meet
his or her own agenda while simultaneously trying to fulfill the organization’s
expectations. The most likely effects of this situation are prolonged stress ,
fatigue, frustration, and helplessness under the burden of overwhelming
demands. The person literally exhausts his or her aspirations and motivation,
much as a candle burns itself out. Loss of self-confidence and psyc hological
withdrawal follow. Ultimately, burnout may be the result. At this point, the
individual may start dreading going to work in the morning, may put in longer
hours but accomplish less than before, and may generally display mental and
physical exhaustion.101
Managing and Controlling Stress
Given that stress is widespread and so potentially disruptive in organizations,
it follows that people and organizations should be concerned about how to
manage it more effectively. And in fact they are. Many strategies have been
developed to help manage stress in the workplace. Some are for individuals,
and others are geared toward organizations.102
Individual Coping Strategies
Many strategies for helping individuals manage stress have been proposed.
Exercise is one method of managing stress. People who exercise regularly are
less likely to have heart attacks than inactive people. More directly, research
has suggested that people who exercise regularly feel less tension and stress ,
are more self-confident, and show greater optimism. People who do not exercise regularly feel more stress, are more likely to be depressed, and experience
other negative consequences.
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155
IMPROVE YOUR SKILLS
STRESS MANAGEMENT TIPS
We all feel stress from time to time. Knowing how to manage
your stress will help to keep you healthy and productive. Two
main strategies for managing stress are: (1) generate calm or
relaxed feelings to counteract the ­biological state of exhaustion or over-arousal, and (2) change your appraisal of the
stress-inducing situation to reduce negative emotions. Below
are some tips for using each strategy.
7.
Changing Your Appraisal of the Situation
1.
Generating Calm or Relaxed Feelings
1.
2.
3.
4.
5.
6.
that right now. If I do, I’ll go crazy. I’ll think about that
tomorrow.”
Learn to say “No,” “Not now,” and “I really can’t”—
no one can do everything!
Eat healthy and avoid too much caffeine.
Get enough high-quality sleep; take a nap if
necessary.
Exercise.
Practice relaxation techniques including meditation.
These are known to relax muscles and reduce
adrenaline levels.
Develop affectionate relationships. Giving and getting
hugs, petting a dog or cat, or having conversations
with friends can all reduce feelings of stress.
Prioritize your to-do list. As Scarlett O’Hara says in
the movie Gone with the Wind, “I can’t think about
2.
3.
Try to view crises or stressful events as opportunities.
The Chinese character for crisis, wei ji, is made up of
two component characters. One is the character for
danger, and the other is the character for opportunity.
Framing a crisis as an opportunity decreases negative
emotions and increases positive emotions, reducing
stress.
Reframe the stressor. Casting the situation in a less
stressful or threatening way can decrease negative
emotions and stress. For example, the boss is not
really trying to make your job difficult; she is just very
busy and has deadlines to meet.
Try to find the silver lining. Your boss’s moving up the
deadline for that big report is challenging, but it gives you
a chance to show your talent, and it will soon be done!
KRISTIA
N SEKU
T
LIC/GET
Y IMAG
ES
A related method of managing stress is relaxation. We noted at the beginning of the chapter that coping with stress requires adaptation. Proper relaxation is an effective way to adapt. Relaxation can take many
forms. O ne way t o r elax i s t o t ake r egular
vacations. One study found that people’s attitudes toward a variety of workplace c haracteristics improved significantly following a
vacation.103 People can also relax while on the
job. For example, it has been recommended that
people take regular rest breaks during their
normal workday.104 A popular way of resting is
to sit quietly with c losed eyes for ten minutes
every afternoon. (Of course, it might be necessary
to have an alarm clock handy!)
Time management is often recommended
for managing stress. The idea is that many daily
People can adopt a variety of techniques to help cope with
stress. Exercise, relaxation, and better time management are
all common methods. These coworkers are engaging in deep
breathing exercises to help control their stress.
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ILDOGESTO/SHUTTERSTOCK.COM
CHAPTER 4 | Individual Values, Perceptions, and Reactions
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PART 2 | Individual Behaviors and Processes in Organizations
pressures can be eased or eliminated if a person does a better job of managing
time. One popular approach to time management is to make a list every morning
of the things to be done that day. Then you group the items on the list into three
categories: critical activities that must be perform ed, important activities that
should be performed, and optional or trivial things that can be delegated or post poned. Then, of course, you do the things on the list in their order of importance .
This strategy helps people get more of the important things done every day. It also
encourages delegation of less important activities to others.
Somewhat related to time management is the idea of role management, in
which the individual actively works to avoid overload, ambiguity, and conflict. For
example, if you do not know what is expected of you, you should not sit and worry
about it. Instead, ask for clarification from your boss. Another role management
strategy is to learn to say “No.” As simple as saying “No” might sound, a lot of
people create problems for themselves by always saying “Yes.” Besides working in
their regular jobs, they agree to serve on committees, volunteer for extra duties,
and accept extra assignments. Sometimes, of course, we have no choice but to
accept an extra obligation (if our boss tells us to complete a new project, we will
probably have to do it). In many cases, however, saying “No” is an option.105
A final method for managing stress is to develop and maintain support
groups. A support group is simply a group of family members or friends with
whom a person can spend time. Going out after work with a couple of coworkers to a basketball game, for example, can help relieve the stress that builds
up during the day. Supportive family and friends can help people deal with
normal stress on an ongoing basis. Support groups can be particularly useful
during times of crisis. For example, suppose an employee has just learned that
she did not get the promotion she has been working toward for months. It may
help her tremendously if she has good friends to lean on, be it to talk to or to
yell at.
Organizational Coping Strategies
Organizations are also increasingly realizing that they should be involved in
managing their employees’ stress.106 There are two different rationales for
this view. One is that because the organization is at least partly responsible
for creating the stress, it should help relieve it. The other is that workers experiencing lower levels of harmful stress will function more effectively. Two basic
organizational strategies for helping employees manage stress are institu tional programs and collateral programs.
Institutional programs for managing stress are undertaken through
established organizational mechanisms. For example, properly designed jobs
and work schedules (both discussed in Chapter 6) can help ease stress . Shift
work, in particular, can cause major problems for employees, because they constantly have to adjust their sleep and relaxation patterns. Thus, the design of
work and work schedules should be a focus of organizational efforts to reduce
stress. The organization’s culture also can be used to help manage stress . In
some organizations, for example, there is a strong norm against taking time off
or going on vacation. In the long run, such norms can cause major stress. Thus,
the organization should strive to foster a culture that reinforces a healthy mix
of work and nonwork activities . Finally, supervision can pla y an important
institutional role in managing stress. A supervisor can be a major source of
overload. If made aware of their potential for assigning stressful amounts of
work, supervisors can do a better job of keeping workloads reasonable.
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
In addition to institutional efforts aimed at reducing stress , many organizations are turning to collateral programs . A collateral stress program is
an organizational program specifically created to help employees deal with
stress. Organizations ha ve adopted stress management programs , health
promotion programs, and other kinds of programs for this purpose . More
and more companies are developing their own programs or adopting existing
programs of this type . For example, Lockheed Martin offers screening pro grams for its employees to detect signs of hypertension. Many firms today also
have employee fitness programs. These programs attack stress indirectly by
encouraging employees to exercise, which is presumed to reduce stress. On the
negative side, this kind of effort costs considerably more than stress manage ment programs because the firm must invest in physical facilities. Still, more
and more companies are exploring this option. 107 L. L. Bean, for example, has
state-of-the-art fitness centers for its employees, and many technology companies such as Google and Facebook provide on-site massages and gyms for their
employees.
Finally, organizations try to help employees cope with stress through other
kinds of programs. For example, existing career development programs, such
as the one at General Electric, are used for this purpose. Other companies use
programs promoting everything from humor to massage to yoga as antidotes
for stress.108 Of course, little or no research supports some of the claims made
by advocates of these programs . Thus, managers must take steps to ensure
that any organizational effort to help employees cope with stress is at least
reasonably effective.
The Republic of Tea, a small, privately held company that promotes
healthy lifestyles centered around the consumption of tea, has measured its
stress-reduction efforts’ effectiveness. The firm recently added a comprehensive program called the Health Ministry to help its employees live healthier
lives. A nutritionist provided free counseling to employees about their diet
and weight, employees got a $500 credit for gym memberships, and a workday
walking program encouraged all employees to take 10- to 15-minute walks
on company time. Employees were even provided with high-quality w alking
shoes. The firm says that its health management efforts have boosted its order
processing efficiency by 11 percent, increased order accuracy by 7 percent, and
decreased employee absenteeism.109
Work-Life Balance
At numerous points in this chapter we have alluded to relationships between
a person’s work and life. In this final brief section we will make these relationships a bit more explicit.
Fundamental Work-Life Relationships
Work-life relationships can be characterized in any number of ways. Consider,
for example, the basic dimensions of the part of a person’s life tied specifically
to work. Common dimensions would inc lude such things as an individual’ s
current job (including working hours, job satisfaction, and so forth), his or her
career goals (the person’s aspirations, career trajectory, and so forth), interpersonal relations at work (with the supervisor, subordinates, coworkers, and
others), and job security.110
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PART 2 | Individual Behaviors and Processes in Organizations
work-life relationships
Interrelationships between
a person’s work life and
personal life
Part of each person’s life is also distinctly separate from work. These dimensions might include the person’s spouse or life companion, dependents (such as
children or elderly parents), personal life interests (hobbies, leisure-time interests, religious affiliations, community involvement), and friendship networks.
Work-life relationships, then, include any relationships between dimensions of
the person’s work life and the person’s personal life. For example, a person with
numerous dependents (a nonworking spouse or domestic partner, dependent children, dependent parents, etc.) may prefer a job with a relatively high salary, few
overtime demands, and little travel. On the other hand, a person with no dependents may be less interested in salary and more receptive to overtime , and may
enjoy job-related travel. Stress will occur when there is a basic inconsistency or
incompatibility between a person’s work and life dimensions. For example, if a
person is the sole care provider for a dependent elderly parent but has a job that
requires considerable travel and evening work, stress is likely to result.
Balancing Work-Life Linkages
Balancing work-life linkages is, of course, no easy thing to do. Demands from
both sides can be extreme, and people may need to be prepared to make tradeoffs. The important thing is to recognize the potential trade-offs in advance so
that they can be carefully weighed and a comfortable decision made . Some of
the strategies for doing this were discussed earlier. For example, working for
a company that offers flexible work schedules may be an attractive option.111
Individuals must also recognize the importance of long-term versus shortterm perspectives in balancing their work and personal lives. For example, people may have to respond a bit more to work demands than to life demands in
the early years of their careers . In mid-career, they may be able to ac hieve a
more comfortable balance. And in later career stages, they may be able to put
life dimensions first by refusing to relocate, working shorter hours, and so forth.
People also have to decide for themselves what they value and what tradeoffs they are willing to make . For instance, consider the dilemma faced by a
dual-career couple when one partner is being transferred to another city. One
option is for one of the partners to subordinate her or his career for the other
partner, at least temporarily. For example, the partner being transferred can
turn the offer down, risking a potential career setbac k or the loss of the job .
Or the other partner ma y resign from his or her current position and seek
another one in the new location. The couple might also decide to live apart,
with one moving and the other staying. The partners might also come to realize that their respective careers are more important to them than their rela tionship and decide to go their separate ways.112
SUMMARY AND APPLICATION
Attitudes, values and emotions, perception, and stress are all important factors that influence organizational behavior. Our beliefs and feelings about
something influence our attitudes about it. Our attitudes then affect our
behavior through our intentions. The three most important job-related attitudes are job satisfaction, organizational commitment, and employee engagement. Job satisfaction reflects our attitudes and feelings about our job .
Organizational commitment is the degree to whic h an employee identifies
with the organization and its goals and wants to stay with the organization.
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
Employee engagement reflects a heightened emotional and intellectual con nection that an employee has for his or her job, organization, manager, or
coworkers that, in turn, influences the employee to apply additional discre tionary effort to his or her work.
There are many different kinds of values that can be held by people . Not
surprisingly, then, it is somewhat common for an individual to have conflicting
values. Values also differ across cultures in different parts of the globe. Emotions, affect, and mood are also important contributors to behavior. Emotions
are intense, short-term physiological, behavioral, and psychological reactions
to a specific object, person, or event that prepare us to respond to it. Mood, on
the other hand, is a short-term emotional state not directed toward anything
in particular. Affect represents our tendency to experience a particular mood
or to react to things with certain emotions.
Perception is the set of processes by which a person becomes aware of and
interprets information about the environment. Basic perceptual processes
include selective perception and stereotyping. The halo effect occurs when we
form an overall impression about someone on the basis of a single (typically
good) characteristic. The contrast effect happens when we evaluate someone by
comparing that person to other people we have recently encountered who rank
higher or lower on the same characteristics. We also project our own characteristics onto others whom we perceive to be similar to us in some ways. Perception
and attribution are also closely related. Internal attributions include ability and
effort. External attributions include luck, not having sufficient resources, and
the interference or help of other people. Distributive fairness is the perception
of fairness of the outcome received. Procedural fairness is the fairness of the
policies and procedures used to make the decision and determine the outcomes .
Interpersonal fairness refers to the politeness, dignity, and respect with which
people were treated during the decision-making process. Informational fairness
focuses on the adequacy of the information and explanations received during
the decision-making process. Trust is an outcome of fairness.
Stress is an individual’s response to a strong stimulus. Challenging events
are stressful only when also accompanied by negative emotions . Some stress
is actually beneficial. Functional stress is the experience of a manageable
level of stress for a reasonable period of time that generates positive emotions
including satisfaction, excitement, and enjoyment. Dysfunctional stress is an
overload of stress from a situation of either under- or over-arousal that continues for too long.
The General Adaptation Syndrome outlines the basic stress process .
Stress can be caused by task, physical, role, and interpersonal demands. Consequences of stress include organizational and individual outcomes, as well as
burnout. Several things can be done to manage stress.
DISCUSSION QUESTIONS
1. If your boss was not sure it would be worth the investment to change the
company’s hiring practices t o include an evaluation of applicants’ atti tudes, what would you tell him or her?
2. Do you think that it would be easy to influence a subordinate’ s attitudes,
values, or emotions? Why? Which would have the largest influence on the
employee’s behavior? Why?
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PART 2 | Individual Behaviors and Processes in Organizations
REAL W O R LD R E S PO N S E
ATTITUDE IS A CHOICE AT PIKE PLACE FISH MARKET
John Yokoyama had recently purchased Seattle’s
grouchy attitude and irritate our coworkers and cus-
Pike Place Fish Market. Continuing the previous own-
tomers. Or we can bring a sunny, playful, cheerful
er’s fear-based management style led to low morale,
attitude and have a great day. We can choose the
high turnover, and bad employee attitudes. To revive
kind of day we will have. We spent a lot of time talk-
his flagging business, he decided to share his vision
ing about this choice, and we realized that as long
of being world famous with his employees, and
as we are going to be at work, we might as well
empowered them to pursue this vision. He gave his
have the best day we can have.”113
employees permission to have fun with their jobs and
Yokoyama’s goal of being world famous has also
to perform their best by bringing their whole selves
been realized. The market is known worldwide for its
to work every day. Together, Yokoyama and his
fun atmosphere and positive employee attitudes. The
employees developed four guiding principles:
fishmongers enjoy letting customers know they are
1. Choose your attitude: We may have no control
important whether they buy anything or not, and con-
over what job we have, but we do control how
stantly entertain them. Employees sing, throw fish,
we approach our job.
and play jokes on each other and on customers.
2. Make their day: Engage and delight customers
Throwing fish and playing jokes on customers
and coworkers; don’t grudgingly do the bare
obviously would not work as well for every business
minimum.
as it did for Seattle’s Pike Place Fish Market. By
3. Be present: Don’t dwell on where you aren’t;
developing healthy work relationships and creating
instead, make the most of where you are. When
positive attitudes and emotions in employees and
talking to customers and coworkers, look them in
customers, the business is now worth 1,000 times
the eye and give them your full attention.
more than Yokoyama paid for it more than thirty-five
4. Play: Have as much fun as you can at whatever
years ago. The market has been featured on numer-
you’re doing to cultivate a spirit of innovation
ous television shows, and was even named one of
and creativity.
the most fun places to work in America by CNN.
As one fishmonger explains, “My buddies and I
Sources: Christensen, J. (2003). First Person: Gone Fishin’. Sales
and Marketing Management, 155(4), 53; Hein, K. (2002).
Hooked on Employee Morale. Incentive, 176(8), 56–57; Lundin,
S. C., Paul, H., & Christensen, J. (2000). Fish! A remarkable Way
to Boost Morale and Improve Results. New York: Hyperion; Yerkes, L. (2007). Fun Works: Creating Places Where People Love to
Work. San Francisco: Berrett-Koehler.
realized that each day when we come to the fish
market we bring an attitude. We can bring a moody
attitude and have a depressing day. We can bring a
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
3. What are the components of an individual’s attitude? Relate each component to an attitude your currently have about something.
4. Do terminal or instrumental values have a larger influence on your behavior at work? Explain.
5. Think of a person you know who seems to ha ve positive affectivity. Think
of another who has more negative affectivity. How constant are they in
their expressions of mood and attitude?
6. How does perception affect behavior? What stereotypes do you form about
people? Are they good or bad?
7. Recall a situation in which you made attributions and describe them using
the framework supplied in Figure 4.5.
8. Do you consider yourself a Type A or a Type B person? Why? Do you think
a person who is a Type A can change to become more like a Type B? If so,
how?
9. What are the major stressors for a student? What consequences are students most likely to suffer as a result of too much stress?
10. Do you agree that a certain degree of stress is necessary to induce high
energy and motivation?
UNDERSTAND YOURSELF
Positive and Negative Affectivity*
Recall that affectivity represents our tendency to experience a particular
mood or to react to things with certain emotions. Individuals with a high positive affectivity experience tend to experience more positive emotions including
cheerfulness or enthusiasm. Individuals higher in negative affectivity tend to
experience more negative emotions, such as irritation or nervousness.
Complete and score the positive and negative affectivity self-assessment
on page 141 in this chapter. Your instructor will pair you with another student.
The two of you should spend two minutes discussing anything you like . After
the two minutes are up, each of you should try to guess the other’ s emotional
disposition (you do not have to reveal your actual score if you do not want to).
*We thank Professor P aul Harvey at the University of New Hampshire for suggesting
this exercise.
GROUP EXERCISE
The Effect of Emotion on Team Performance
In this exercise you will be asked to role-pla y a particular emotion as a member of a work team. After dividing into teams of four peop le, count off one to
four to identify your role in the team by reading the description below. If your
team has more than four people, restart the numbering at 1 when you get to
the fifth person.
Role 1: Grouchy, negative affect
Role 2: Calm
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161
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PART 2 | Individual Behaviors and Processes in Organizations
Role 3: Happy, positive affect
Role 4: Calm
For the next five to ten minutes (until the instructor tells you to stop),
your team’s task is to discuss possible slogans for the field of organizational
behavior and identify your team’ s favorite idea. When your instructor tells
you, your role will change to the following:
Role 1: Calm
Role 2: Happy, positive affect
Role 3: Calm
Role 4: Grouchy, negative affect
You will spend the next five to ten minutes (until the instructor tells you
to stop) discussing the best ways for the manager of a local McDonald’s restaurant to improve the employees’ job engagement and deciding on your group’s
favorite three ideas. When your instructor ends the task, address the following
questions as a group and be prepared to share your answers with the class.
Questions
1. Did your emotion influence your own performance or beha vior in your
team?
2. Did any emotional contagion occur in your team? If so, was the ­positive
(happy) or negative (grouchy) emotion more contagious? Why do you
think this was so?
3. What could a leader do to effectively manage a team’ s emotion? Is it
worth trying?
VIDEO EXERCISE
Recycline Preserve: Strategy and the
Partnership Advantage
Recycline began in 1996 when founder Eric Hudson designed an innovative
toothbrush out of all-recycled material. Today, Recycline’s eco-friendly product
line, Preserve, includes a range of personal care items, tableware, and kitchen
goods. Recycline’s materials may be recycled, but its strategy is completely
new. By offering products that make consumers feel good about their pur chases, Recycline not only delivers higher value products but also introduces
fresh ideas in the industry.
In 2007, Whole Foods and Recyc line launched a line of kitc henware
products that included colanders, cutting boards, mixing bowls, and storage containers. “Together we did the competitive research, we speced out the
products, and we developed the pricing strategy and designs,” Webb said. “It
created less risk on both sides.”
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CHAPTER 4 | Individual Values, Perceptions, and Reactions
163
Through its various partnerships, Recycline was able to take an untested
product and sell it at the nation’ s largest and most respected natural foods
store. Whole Foods in turn used its experience and resources to ensure the
product sold well. “We gave Whole Foods a twelve-month exclusive on the line,”
Webb said, “which in turn gave them a great story to tell.”
Watch the video “Recycline Preserve: Strategy and the Partnership Advantage” as a class. Next, form small groups with 3-4 of your classmates and
develop responses to these questions.
Discussion Questions
Now What?
Imagine meeting with a subordinate who has been working at Happy Time Toys
for a month and can’t yet meet the company’s goals. The subordinate tried hard
to perform well during the training session to look good compared to the other
new hires, but the others are doing a lot better on the job. The subordinate communicates frustration about being unable to learn the new job. What do you say
or do? Go to this chapter’s “Now What?” video, watch the challenge video, and
choose a response. Be sure to also view the outcomes of the two responses you
didn’t choose.
PERCOM/SHUTTERSTOCK.COM
1. What roles do attitudes, values, and emotions play at a firm like Recycline? What role do your existing attitudes about recycling affect how
you see a company like Recycline?
2. What is your perception of CEO Eric Hudson? On what do you base
your perception? What is the public’s perception of green products according to Marketing Director C. A. Webb? Why do some people have
that perception, and what can Recycline do to change it?
3. Would you want to work for Recycline? Why or why not?
VIDEO C A S E
Discussion Questions
1. What attitudes did the employee develop about his performance on the
job? How were they formed?
2. What role do attributions pla y in how the employee responded to c hallenges of learning to do his job? What role do attributions play in how a
manager might respond to a subordinate’s performance?
3. In what ways does fairness influence how the subordinate responded to
the situations you viewed?
4. What other solutions might you have suggested to address the situation?
Explain your answer using concepts from the chapter.
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PART 2 | Individual Behaviors and Processes in Organizations
ENDNOTES
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
LOSKUTNIKOV/SHUTTERSTOCK.COM
CHAPTER
5
MOTIVATING BEHAVIOR
Real World Challenge: Motivating
Cast Members at Disney
CHAPTER
OUTLINE
THE NATURE OF MOTIVATION
The Importance of Motivation
The Motivational Framework
Early Perspectives on Motivation
Individual Differences and Motivation
Global Issues: Motivating a Global
Workforce
NEED-BASED PERSPECTIVES ON
MOTIVATION
The Hierarchy of Needs
The ERG Theory
The Two-Factor Theory
The Acquired Needs Framework
Understand Yourself: What
Motivates You?
After studying this chapter, you should be
able to:
LEARNING
OUTCOMES
1 Characterize the nature of motivation,
including its importance and basic
historical perspectives.
PROCESS-BASED PERSPECTIVES ON
MOTIVATION
The Equity Theory of Motivation
Improve Your Skills: Framing Equity
and Fairness
The Expectancy Theory of Motivation
Case Study: Pride-Building at Aramark
LEARNING-BASED PERSPECTIVES ON
MOTIVATION
How Learning Occurs
Reinforcement Theory and Learning
Social Learning
Behavior Modification
SUMMARY AND APPLICATION
Real World Response: Motivating
Case Members at Disney
3 Identify and describe the major
process-based perspectives on
motivation.
4 Describe learning-based perspectives
on motivation.
2 Identify and describe the need-based
perspectives on motivation.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
MOTIVATING CAST MEMBERS AT DISNEY
The Walt Disney Company started out in 1923 as a small animation studio. In the decades
since then the company has grown to become the largest entertainment business in the
world. Disney owns or operates eleven theme parks, operates its own cruise line, and
owns several television networks, including ABC, ESPN, and, of course, the Disney channel. The company also continues to extend its reach, recently purchasing such properties as
Pixar Animation Studios, Marvel Comics, and Lucasfilm.1
One of Disney’s hallmarks is legendary customer service, especially at its theme parks
and on its cruise ships. Theme park employees are called “cast members” and are taught
that the ultimate goal is guest happiness and that no matter what role they play, they are
expected to smile, project a positive image, and be friendly. Disney wants to motivate its
cast members to provide the four service basics of projecting a positive image and energy,
being courteous and respectful to all guests, staying in character and playing the part, and
going above and beyond expectations, and asks you for suggestions.2 After reading this
chapter, you should have some good ideas.
LOSKUTNIKOV/SHUTTERSTOCK.COM
REAL WORLD CHALLENGE
RSBPHOTO1 / ALAMY
Exemplary customer service is a hallmark at The Walt Disney Company.
To maintain high levels of customer service Disney managers must motivate
their employees, or “cast members” as they are called, to always do
whatever they can to please visitors and ensure that they have a great
experience.
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170
PART 2 | Individual Behaviors and Processes in Organizations
Given the complex array of individual differences discussed in Chapter 3 (and
extended later in this c hapter), it should be obvious that people work for a
wide variety of reasons. Some people want money, some want a challenge, and
some want power. What people in an organization w ant from work and how
they think they can achieve it plays an instrumental role in determining their
motivation to work. As we see in this chapter, motivation is vital to all organizations. Indeed, the difference between highly effective organizations and
less effective ones often lies in the motivations of their members . Thus, managers need to understand the nature of individual motivation, especially as it
applies to work situations. In this chapter we first explore various need-based
perspectives on motivation. We then turn our attention to the more sophisti cated process-based perspectives. We conclude with a discussion of learningbased perspectives on motivation.3
THE NATURE OF MOTIVATION
motivation
The set of forces that
leads people to behave in
particular ways
Motivation is the set of forces that causes people to engage in one behavior rather than some alternative behavior.4 Students who start assignments
several weeks before they are due to ensure that their term papers are the
best they can be, salespeople who work on Saturdays to get ahead, and doctors
who make follow-up phone calls to patients to check on their conditions are all
motivated people. Of course, students who avoid the term paper by spending
the day at the beach, salespeople who go home early to escape a tedious sales
call, and doctors who skip follow-up calls to ha ve more time for golf are also
motivated, but their goals are different. From the manager’s viewpoint, the
objective is to motivate people to behave in ways that are in the organization’s
best interest.5
The Importance of Motivation
Managers strive to motivate people in the organization to perform at high levels. This means getting them to work hard, to come to work regularly, and to
make positive contributions to the organization’s mission. But job performance
depends on ability and environment as well as motivation. This relationship
can be stated as follows:
where
P=M×A×E
P = performance, M = motivation,
A = ability, and E = environment
To reach high levels of performance, an employee must want to do the job
well (motivation); must be able to do the job effectively (ability); and must
have the materials, resources, equipment, and information required to do the
job (environment). A deficiency in any one of these areas hurts performance.
A manager should thus strive to ensure that all three conditions are met.6
In most settings, motivation is the most difficult of these factors tom
­ anage.
If an employee lacks the ability to perform, she or he can be sent to training
programs to learn new job skills. If the person cannot learn those skills, she or
he can be transferred to a simpler job and replaced with a more skilled worker.
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CHAPTER 5 | Motivating Behavior
171
If an employee lacks materials, resources, equipment, and/or information, the
manager can take steps to provide them. For example, if a worker cannot complete a project without sales forecast data from marketing , the manager can
contact marketing and request that information. But if motivation is deficient,
the manager faces the more complex situation of determining what will moti vate the employee to work harder.7 Of course, it is also important to understand what motivates us personally.
The Motivational Framework
We can start to understand motivation by looking at need deficiencies and
goal-directed behaviors. Figure 5.1 shows the basic motivational framework
we use to organize our discussion. A need—something an individual requires
or wants—is the starting point. 8 Motivated beha vior usually begins when
a person has one or more important needs . Although a need that is already
­satisfied may also motivate beha vior (for example, the need to maintain a
standard of living one has already ac hieved), unmet needs usually result in
more intense feelings and behavioral changes. For example, if a person has yet
to attain the standard of living she desires , this unmet need ma y stimulate
her to action.
A need deficiency usually triggers a search for ways to satisfy it. ­Consider
a person who feels her salary and position are deficient because they do not
reflect the importance to the organization of the work she does and because
she wants more income. She may feel she has three options: to simply ask for
a raise and a promotion, to work harder in the hope of earning a raise and
a promotion, or to look for a new job with a higher salary and a more prestigious title.
Next comes a choice of goal-directed behaviors. Although a person might
pursue more than one option at a time (suc h as working harder while also
looking for another job), most effort is likely to be directed at one option. In
the next phase, the person actually carries out the behavior chosen to satisfy
the need. She will probably begin putting in longer hours, working harder, and
need
Anything an individual
requires or wants
Figure 5.1
Motivational Framework
Experienced
Need
Deficiencies
Search for
Ways to
Satisfy Needs
Choice of
Goal-Directed
Behaviors
Reassessment
of Need
Deficiencies
Experienced
Rewards or
Punishment
Enactment
of Behavioral
Choice
(Performance)
This framework provides
a useful way to see how
motivational processes
occur. When people
experience a need
deficiency, they seek
ways to satisfy it, which
results in a choice of
goal-directed behaviors.
After performing the
behavior, the individual
experiences rewards
or punishments that
affect the original need
deficiency.
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172
PART 2 | Individual Behaviors and Processes in Organizations
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Motivation begins with a need deficiency. Few people aspire to work as custodians or
maids, but the need for money to buy basic necessities can motivate people to accept
these kinds of jobs. Of course, the motivation for higher levels of income can also
drive people to work harder and seek advancement.
so forth. She will next experience either rew ards or punishment as
a result of this choice. She may perceive her situation to be punish ing if she ends up earning no additional recognition and not getting
a promotion or pay raise. Alternatively, she may actually be rewarded
by getting the raise and promotion because of her higher performance.
Finally, the person assesses the extent to whic h the outcome
achieved fully addresses the original need deficiency. Suppose the person wanted a 10 percent raise and a promotion to vice president. If she
got both, she should be satisfied. On the other hand, if she got only a
7 percent raise and a promotion to associate vice president,she will have
to decide whether to keep trying, to accept what she got, or to choose one
of the other options considered earlier. (Sometimes, of course, a need may
go unsatisfied altogether, despite the person’s best efforts.)
Early Perspectives on Motivation
ANDRE
Historical views on motivation, although not always accurate, are of ­interest
for several reasons. For one thing, they provide a foundation for contemporary thinking about motivation. For another, because they generally were
based on common sense and intuition, an appreciation of their strengths
and weaknesses can help managers gain useful insights into employee moti vation in the workplace.
The Traditional Approach
One of the first writers to address work motivation—over a century ago—
was Frederick Taylor. Taylor developed a method for structuring jobs that
he called scientific management. As one basic premise of this approach,
Taylor assumed that employees are economically motivated and work to
earn as much money as they can. 9 Hence, he advocated incentive pa y systems. He believed that managers knew more about the jobs being
performed than did workers, and he assumed that
economic gain was the primary thing that moti vated everyone. Other assumptions of the traditional approach were that work is inherently
unpleasant for most people and that the money
they earn is more important to employees than the
nature of the job they are performing . Hence, people could be expected to perform any kind of job if
they were paid enough. Although the role of money
LIBRAR
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scientific management
Approach to motivation
that assumes that
employees are motivated
by money
Scientific management was developed around the idea that workers
are motivated purely by money. Frederick Taylor advocated using an
incentive pay system to motivate workers to perform tasks like laying
bricks using the “one best way” so as to maximize productivity.
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CHAPTER 5 | Motivating Behavior
173
as a motivating factor cannot be dismissed, ­p roponents of the traditional
approach took too narrow a view of the role of monetary compensation and
also failed to consider other motivational factors.
The Human Relations Approach
The human relations approach supplanted scientific management in the 1930s
.10
The human relations approach assumed that employees want to feel useful
and important, that employees have strong social needs, and that these needs
are more important than money in motivating employees. ­Advocates of the
human relations approach advised managers to make w
­ orkers feel important
and to allow them a modicum of self-direction and self-control in carrying out
routine activities. The feelings of involvement and importance were expected
to satisfy workers’ basic social needs and result in higher motivation to perform.
For example, a manager might allow a workgroup to participate in making
a decision to enhance the quality even if he had mostly determined what
the decision would be. The gesture of allowing participation was expected to
enhance motivation and involvement of the workers.
The Human Resource Approach
The human resource approach to motivation carries the concepts of needs
and motivation one step farther. Whereas the human relationists believed
that feelings of contribution and participation would enhance motivation, the
human resource view, which began to emerge in the 1950s, assumes that the
contributions themselves are valuable to both individuals and organizations.
It assumes that people want to contribute and are able to make genuine con tributions. Management’s task, then, is to encourage participation and to cre ate a work environment that makes full use of the human resources available.
This philosophy guides most contemporary thinking about employee motiva tion. At Ford, Apple, Texas Instruments, and Hewlett-Packard, for example,
work teams are being called upon to solve a variety of problems and to make
substantive contributions to the organization.
human relations
approach
Suggests that fostering
a sense of employees’
inclusion in decision
making will result in
positive employee
attitudes and motivation
to work hard
human resource
approach
Assumes that people
want to contribute and
are able to make genuine
contributions
Individual Differences and Motivation
We noted earlier that individual differences pla y a key role in motivation.
Simply put, different things motivate different people . As we explored
in detail in our last two c hapters, people ha ve different abilities , needs,
­personalities, values, and self-concepts. Because of these myriad differences,
there is no one best w ay to motivate everyone. For example, consider this
conversation:
Nancy: “I can’t believe you quit your job . Your work seemed so
­interesting, and you always had a chance to learn new things. I like
jobs that challenge me. Your new job sounds so boring that I’d go crazy.”
Chris: “Well, it is tedious work, but it pays better than any other job
around.”
What seems to be motivating to Chris? Money. But Nancy places a higher
value on challenging herself and doing a variety of tasks . This simple example highlights the fact that to motivate others , it is critical that you first
­understand what does and what does not motivate them. Our Global Issues
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
174
PART 2 | Individual Behaviors and Processes in Organizations
task specific self-efficacy
A person’s beliefs in his
or her capabilities to
do what is required to
accomplish a specific task
feature describes how differences between people also extend to cultural
­differences as well.
An easy mistake to make when trying to motivate others is assuming that
the same things that motivate you also motivate them. People are diverse
in the personality, values, needs, abilities, cultures, and interests they bring to
their jobs. These individual characteristics motivate us to work harder at some
things than at others. Individual characteristics are internal motivational factors that are a part of who we are and compel us to try harder and exert more
effort toward reaching some goals as compared to others . The starting point
for motivated employees is hiring people whose individual characteristics lead
to high motivation on the job. A job requiring high-quality work will not be as
motivating to someone who lacks attention to detail as it will to a conscien tious, detail-oriented person. In your own career, finding a job that has the
potential to fulfill your needs, meet your goals, and complement your attitudes
can help you to maintain your motivation as well.
In addition to the various individual differences we ha ve already dis cussed, one additional element is often very specifically related to the motivation to perform a specific task. If you did not think that you could sell
enough products to meet your quota, would you be motivated to try very hard?
Because people are motivated in part by what they expect to be able to do, you
would probably not be very motivated. Alternatively, if you are very confident
that you can meet your quota, and having met that quota receive a large commission, you would probably be very motivated to work hard. Recall our discussion of general self-efficacy as an individual difference bac k in ­Chapter 3.
A specific form of self-efficacy is especially related to employee motivation.
Task-specific self-efficacy is a person’s beliefs in his or her capabilities to
do what is required to accomplish a specific task.11 Task-specific self-efficacy
influences an individual’s effort and persistence in the face of c hallenges
related to performing a specific task.12 Task-specific self-efficacy beliefs have
three dimensions:
1. Magnitude: beliefs about how difficult a specific task can be accomplished
2. Strength: beliefs about how confident the person is that the specific task
can be accomplished
3. Generality: beliefs about the degree to which similar tasks can be
accomplished.
Because task-specific self-efficacy perceptions are changeable, good managers proactively enhance subordinates’ perceptions of their abilities. Managers can raise task-specific self-efficacy through coaching and encouragement,
assuming the employee really does have the potential to perform better. If
an employee fails at a task he or she should be able to do , the manager can
express confidence in the employee and guide him or her through successful
experiences. When an employee is successful, the manager can discuss how
the success was due to the employee’s skills and effort (rather than to luck) to
enhance his or her task-specific self-efficacy.
Similarly, if you find yourself lacking the confidence that you can do a task,
you can take steps to eliminate the performance barriers you identify. Perhaps
more practice, seeking a coach, or watching others perform the task successfully will increase your task-specific self-efficacy and motivation. One of the
most important determinants of motivation, and thus success, is whether you
believe you can accomplish the things you are trying to do.
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GLOBAL
175
ISSUES
MOTIVATING A GLOBAL WORKFORCE
Effectively motivating employees located across the globe is
a significant challenge. Managers must be sensitive to cultural differences in values and needs and understand that
what is acceptable in one culture may be taboo in another.
The American culture is more individualistic and egocentric than many other cultures. Because American culture values individual achievement, Americans often have
a desire to be singled out and praised. In some cultures,
people would be embarrassed or even ashamed if they
received the attention Americans strive for. In Japan, for
example, there is a saying, “It’s the nail that sticks up that
gets pounded.” Motivation and reward programs in the
Far East also tend to be more paternal than in the United
States. In Indonesia, if a company has a good year,
bonuses are not a function of individual performance but
rather of each employee’s organizational loyalty as measured by the number of years worked with the company,
plus the size of his or her family.13
Some motivation principles, like treating people with
respect, apply equally well around the world. For example,
Colgate-Palmolive operates in more than 170 countries
and receives about 70 percent of its $7 billion revenues
from overseas markets. A truly global company, Colgate
expects managers everywhere to show respect for their
employees. Colgate-Palmolive’s performance-evaluation
system, for instance, evaluates how managers exemplify
and reinforce respect.14 Employees from different cultures
may differentially value things like equality and individualism, but being treated with fairness and respect resonates
globally.
NEED-BASED PERSPECTIVES ON
MOTIVATION
Need-based perspectives represent the starting point for most contempo rary thought on motivation, although these theories also attracted critics. 15
The basic premise of need-based theories and models, consistent with our
­m otivation framework introduced earlier , is that humans are motivated
­primarily by deficiencies in one or more important needs or need categories .
Need theorists have attempted to identify and categorize the needs that are
most important to people .16 (Some observers call these “content theories”
because they deal with the content, or substance, of what motivates behavior.)
The best-known need theories are the hierarchy of needs and the ERG theory.
need-based theories
Assume that need
deficiencies cause
behavior
The Hierarchy of Needs
The hierarchy of needs, developed by psyc hologist Abraham Maslow in the
1940s, is the best-known need theory.17 Influenced by the human relations
school, Maslow argued that human beings are “wanting” animals: They have
innate desires to satisfy a given set of needs. Furthermore, Maslow believed
that these needs are arranged in a hierarc hy of importance, with the most
basic needs at the foundation of the hierarchy.
Figure 5.2 shows Maslow’s hierarchy of needs. The three sets of needs at the
bottom of the hierarchy are called deficiency needs because they must be satisfied
for the individual to be fundamentally comfortable. The top two sets of needs are
termed growth needs because they focus on personal growth and development.
hierarchy of needs
Assumes that human
needs are arranged in a
hierarchy of importance
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
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CHAPTER 5 | Motivating Behavior
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PART 2 | Individual Behaviors and Processes in Organizations
Figure 5.2
Maslow’s hierarchy
of needs consists of
five basic categories
of needs. This figure
illustrates both general
and organizational
examples of each type
of need. Of course, each
individual has a wide
variety of specific needs
within each category.
The Hierarchy of Needs
Organizational Examples
General Examples
Achievement
SelfActualization
Needs
Challenging Job
Status
Esteem Needs
Job Title
Friendship
Stability
Sustenance
Belongingness Needs
Friends in Work Group
Security Needs
Pension Plan
Physiological Needs
Base Salary
Source: Adapted from Abraham H. Maslow, “A Theory of Human Motivation,” Psycho-logical Review, 1943, vol.,
50, pp. 374–396.
The most basic needs in the hierarc hy are physiological needs. These
include the needs for food, sex, and air. Next in the hierarc hy are security
needs: things that offer safety and security, such as adequate housing and
clothing and freedom from worry and anxiety. Belongingness needs, the third
level in the hierarchy, are primarily social. Examples include the need for love
and affection and the need to be accepted by peers. The fourth level, esteem
needs, actually encompasses two slightly different kinds of needs: the need for
a positive self-image and self-respect and the need to be respected by others .
At the top of the hierarchy are self-actualization needs. These involve a person’s realizing his or her full potential and becoming all that he or she can be.
Maslow believed that each need level must be satisfied before the level
above it can become important. Thus, once physiological needs have been satisfied, their importance diminishes, and security needs emerge as the primary
sources of motivation. This escalation up the hierarc hy continues until the
self-actualization needs become the primary motivators. Suppose, for example,
that Jennifer Wallace earns all the money she needs and is very satisfied with
her standard of living. Additional income may have little or no motivational
impact on her behavior. Instead, Jennifer will strive to satisfy other needs,
such as a desire for higher self-esteem.
However, if a previously satisfied lower -level set of needs becomes defi cient again, the individual returns to that level. For example, suppose that
Jennifer unexpectedly loses her job . At first, she ma y not be too worried
because she has savings and confidence that she can find another good job. As
her savings dwindle, however, she will become increasingly motivated to seek
new income. Initially, she may seek a job that both pays well and satisfies her
esteem needs. But as her financial situation grows worse, she may lower her
expectations regarding esteem and instead focus almost exclusively on simply
finding a job with a reliable paycheck.
In most businesses, physiological needs are probably the easiest to evalu ate and to meet. Adequate wages, clean restrooms, ventilation, and comfortable
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CHAPTER 5 | Motivating Behavior
ANDRE
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temperatures and working conditions are measures taken to satisfy this most
basic level of needs. Security needs in o­ rganizations can be satisfied by suc h
things as job continuity (no layoffs), a grievance system (to ­protect against arbitrary supervisory actions), and an adequate insurance and retirement system
(to guard against financial loss from illness and to ensure retirement income).
Most employees’ belongingness needs are satisfied by family ties and
group relationships both inside and outside the organization. In the workplace, people usually develop friendships that provide a basis for social interaction and can pla y a major role in satisfying social needs . Managers can
help satisfy these needs by f­ ostering interaction and a sense of group iden tity among employees. At the same time, managers can be sensitive to the
probable effects on employees (suc h as low performance and absenteeism)
of family problems or lack of acceptance by coworkers. Esteem needs in the
workplace are met at least partially by job titles , choice offices, merit pay
increases, awards, and other forms of recognition. Of course, to be sources
of long-term motivation, tangible rewards such as these must be distributed
equitably and be based on performance.
Self-actualization needs are perhaps the hardest to understand and the
most difficult to satisfy. For example, it is difficult to assess how many peo ple completely meet their full potential. In most cases, people who are doing
well on Maslow’s hierarchy will have satisfied their esteem needs and will
be moving toward self-actualization. Working toward self-actualization, rather
than actually achieving it, may be the ultimate motivation for most people. In
recent years there has been a pronounced trend tow ard people leaving wellpaying but less fulfilling jobs to take lower-paying but more fulfilling jobs such
as nursing and teaching. This might indicate that they are actively working
toward self-actualization.18
Research shows that the need hierarchy does not generalize very well to
other countries. For example, in Greece and Japan, security needs may motivate employees more than self-actualization needs. Likewise, belongingness
needs are especially important in Sweden, Norway, and Denmark. Research
has also found differences in the relative importance of different needs in
Mexico, India, Peru, Canada, Thailand, Turkey, and Puerto Rico.19
Maslow’s needs hierarchy makes a certain amount of ­intuitive sense. And
because it was the first motivation theory to become popular,
it is also one of the best known among practicing managers. However, research has revealed a
number of deficiencies in the theory. For example, five levels of needs are not alw ays present;
the actual hierarc hy of needs does not alw ays
conform to Maslow’s model; and need structures
are more unstable and variable than the theory
would lead us to believe .20 And sometimes managers are overly c lumsy or superficial in their
attempts to use a theory such as this one. Thus, the
According to Abraham Maslow people may be motivated by a
hierarchy of needs, including social needs to belong to groups
and be part of friendships. These co-workers are apparently
helping meet their belongingness needs through close working
relationships at work.
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177
178
PART 2 | Individual Behaviors and Processes in Organizations
theory’s primary contribution seems to lie in providing a general framework
for categorizing needs.
The ERG Theory
ERG theory
Describes existence,
relatedness, and growth
needs
The ERG theory, developed by Yale psychologist Clayton Alderfer, is another
historically important need theory of moti vation.21 In many respects, ERG
theory extends and refines Maslow’s needs hierarchy concept, although there
are also several important differences between the two. The E, R, and G stand
for three basic need categories: existence, relatedness, and growth. Existence
needs—those necessary for basic human survival—roughly correspond to the
physiological and security needs of Maslow’s hierarchy. Relatedness needs—
those involving the need to relate to others—are similar to Maslow’s belongingness and esteem needs. Finally, growth needs are analogous to Maslow’s
needs for self-esteem and self-actualization.
In contrast to Maslow’s approach, ERG theory suggests that more than one
kind of need—for example, both relatedness and growth needs—may motivate a
person at the same time. A more important difference from Maslow’s hierarchy
is that ERG theory includes a satisfaction-progression component and a frustration-regression component. The satisfaction-progression concept suggests
that after satisfying one category of needs, a person progresses to the next level.
On this point, the need hierarchy and ERG theory agree. The need hierarchy,
however, assumes that the individual remains at the next level until the needs
at that level are satisfied. In contrast, the frustration-regression component
of ERG theory suggests that a person who is frustrated by trying to satisfy a
higher level of needs eventually will regress to the preceding level.22
Suppose, for instance, that Nick Hernandez has satisfied his basic needs
at the relatedness level and now is trying to satisfy his growth needs . That is,
he has many friends and social relationships and is now trying to learn new
skills and advance in his career. For a variety of reasons, such as organizational constraints (i.e., few challenging jobs, a glass ceiling, etc.) and the lack
of opportunities to advance, he is unable to satisfy those needs. No matter how
hard he tries, he seems stuck in his current position. According to ERG theory,
frustration of his growth needs will cause Nic k’s relatedness needs to once
again become dominant as motivators. As a result, he will put renewed interest into making friends and developing social relationships.
The Two-Factor Theory
two-factor theory ­­
(dual-structure theory)
Identifies motivation
factors, which affect
satisfaction, and hygiene
factors, which determine
dissatisfaction
Another important need-based theory of motivation is the two-factor theory,
also called the dual-structure theory. This theory is in many ways similar
to the need theories just discussed. The two-factor theory once played a major
role in managerial thinking about motivation, and though few researchers
today accept the theory, it is nevertheless still widely known and accepted
among practicing managers.
Development of the Theory
Frederick Herzberg and his associates developed the two-factor theory in the
late 1950s and early 1960s.23 Herzberg began by interviewing approximately
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CHAPTER 5 | Motivating Behavior
200 accountants and engineers in Pittsburgh. He asked them to recall times
when they felt especially satisfied and motivated by their jobs and times when
they felt particularly dissatisfied and unmotivated. He then asked them to
describe what caused the good and bad feelings. The responses to the questions
were recorded by the interviewers and later subjected to content analysis. (In
a content analysis, the words, phrases, and sentences used by respondents are
analyzed and categorized according to their meanings.)
To his surprise, Herzberg found that entirely different sets of factors
were associated with the two kinds of feelings about work. For example,
a person who indicated “low pay” as a source of dissatisfaction would not
necessarily identify “high pay” as a source of satisfaction and motivation.
Instead, people associated entirely different causes , such as recognition or
achievement, with satisfaction and motivation. The findings led Herzberg to
conclude that the prevailing thinking about satisfaction and motivation was
incorrect. As Figure 5.3 shows, at the time, job satisfaction was being viewed
as a single construct ranging from satisfaction to dissatisfaction. If this were
the case, Herzberg reasoned, one set of factors should therefore influence
movement back and forth along the continuum. But because his researc h
had identified differential influences from two different sets of factors, Herzberg argued that two different dimensions must be involved. Thus, he saw
motivation as a two-factor phenomenon.
Figure 5.3 also illustrates the two-factor concept that there is one dimen sion ranging from satisfaction to no satisfac tion and another ranging from
dissatisfaction to no dissatisfaction. The two dimensions must presumably
be associated with the two sets of factors identified in the initial interviews .
Thus, this theory proposed, employees might be either satisfied or not satis fied and, at the same time, dissatisfied or not dissatisfied.24
In addition, Figure 5.3 lists the primary factors identified in Herzberg’ s
interviews. Motivation factors such as achievement, recognition, and the
opportunity to plan and control their own work were often cited by people as
primary causes of satisfaction and motivation. When present in a job, these
factors apparently could cause satisfaction and motivation; when they were
absent, the result was feelings of no satisfaction rather than dissatisfaction.
The other set of factors, hygiene factors, came out in response to the ques tions about dissatisfaction and lack of motivation. The respondents suggested
that pay, job security, supervisors, and working conditions, if seen as inade quate, could lead to feelings of dissatisfaction. When these factors were considered acceptable, however, the person still was not necessarily satisfied; rather,
he or she was simply not dissatisfied.25
To use the two-factor theory in the workplace , Herzberg recommended a
two-stage process. First, the manager should try to eliminate situations that
cause dissatisfaction, which Herzberg assumed to be the more basic of the two
dimensions. For example, suppose that Susan Kowalski wants to use the twofactor theory to enhance motivation in the group of seven technicians she
supervises. Her first goal would be to achieve a state of no dissatisfaction by
addressing hygiene factors. Imagine, for example, that she discovers that their
pay is a bit below market rates and that a few of them are worried about job
security. Her response would be to secure a pa y raise for them and to alla y
their concerns about job security.
According to the theory, once a state of no dissatisfaction exists, trying to
improve motivation further through hygiene factors is a w aste of time.26 At
179
motivation factors
Are intrinsic to the work
itself and include factors
such as achievement and
recognition
hygiene factors
Are extrinsic to the work
itself and include factors
such as pay and job
security
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180
PART 2 | Individual Behaviors and Processes in Organizations
Figure 5.3
The traditional view of
satisfaction suggested
that satisfaction and
dissatisfaction were
opposite ends of a single
dimension. Herzberg’s
Two Factor theory found
evidence of a more
complex view. In this
theory, motivation factors
affect one dimension,
ranging from satisfaction
to no satisfaction. Other
workplace characteristics,
called “hygiene factors,”
are assumed to affect
another dimension, ranging
from dissatisfaction to no
dissatisfaction.
The Two Factor Theory of Motivation
The Traditional View
Satisfaction
Dissatisfaction
Herzberg's View
Satisfaction
No Satisfaction
Motivation Factors
Achievement
Recognition
The Work Itself
Responsibility
Advancement and Growth
Dissatisfaction
No Dissatisfaction
Hygiene Factors
Supervision
Working Conditions
Interpersonal Relationships
Pay and Job Security
Company Policies
that point, the motivation factors enter the picture. Thus, when Susan is sure
that she has adequately dealt with hygiene issues, she should try to increase
opportunities for achievement, recognition, responsibility, advancement, and
growth. As a result, she would be helping her subordinates feel satisfied and
motivated.
Unlike many other theorists, Herzberg described explicitly how manag ers could apply his theory. In particular, he developed and described a tec hnique called “job enrichment” for structuring employee tasks.27 (We discuss job
enrichment in Chapter 6.) Herzberg tailored this technique to his key motivation factors. This unusual attention to application may explain the widespread
popularity of the two-factor theory among practicing managers.
Evaluation of the Theory
Because it gained popularity so quickly, the two-factor theory has been scientifically scrutinized more than almost any other organizational behavior theory.28 The results have been contradictory, to say the least. The initial study by
Herzberg and his associates supported the basic premises of the theory, as did
a few follow-up studies.29 In general, studies that use the same methodology as
Herzberg did (content analysis of recalled incidents) tend to support the the ory. However, this methodology has itself been criticized, and studies that use
other methods to measure satisfaction and dissatisfaction frequently obtain
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 5 | Motivating Behavior
181
results quite different from Herzberg’s.30 If the theory is “method bound,” as it
appears to be, its validity is therefore questionable.
Several other criticisms have been directed against the theory. Critics say
the original sample of accountants and engineers may not represent the general working population. Furthermore, they maintain that the theory fails to
account for individual differences. Subsequent research has found that a factor such as pay may affect satisfaction in one sample and dissatisfaction in
another and that the effect of a given factor depends on the individual’ s age
and organizational level. In addition, the theory does not define the relation ship between satisfaction and motivation.
Research has also suggested that the two-factor framework varies across
cultures. Only limited studies have been conducted, but findings suggest that
employees in New Zealand and Panama assess the impact of motivation and
hygiene factors differently from U.S. workers.31 It is not surprising, then, that
the two-factor theory is no longer held in high esteem by organizational behavior researchers. Indeed, the field has since adopted far more complex and valid
conceptualizations of motivation, most of which we discuss in Chapter 6. But
because of its initial popularity and its specific guidance for application, the
two-factor theory merits a special place in the history of motivation research.
The Acquired Needs Framework
Next, w e w ill d iscuss o ne f inal n eed-based m otivation p erspective. The
acquired needs framework was advanced by Da vid McClelland and cen ters on the needs for achievement, affiliation, and power (these needs are also
sometimes referred to as manifest needs).32 A key differentiating element of
this framework is the argument that these needs are acquired, or learned,
from cultural, societal, and family influences.
The Need for Achievement
The need for achievement arises from an individual’s desire to accomplish a
goal or task more effectively than in the past. Individuals who have a high need
for achievement tend to set moderately difficult goals and to make moderately
risky decisions. Suppose, for example, that Mark Cohen, a regional manager for
a national retailer, sets a sales increase goal for his stores of either 1 percent or
50 percent. The first goal is probably too easy, and the second is probably impossible
to reach; either would suggest a low need for achievement. But a mid-range goal
of, say, 15 percent might present a reasonable challenge but also be within reach.
Setting this goal might more accurately reflect a high need for achievement.
High need-achievers also want immediate, specific feedback on their performance. They want to know how well they did something as quic kly after
finishing it as possible. For this reason, high need-achievers frequently take
jobs in sales, where they get almost immediate feedback from customers, and
often avoid jobs in areas suc h as research and development, where tangible
progress is slower and feedback comes at longer intervals. If Mark only asks
his managers for their sales performance on a periodic basis , he might not
have a high need for ac hievement. But if he is constantly calling eac h store
manager in his territory to ask about their sales increases , this activity indicates a high need for achievement on his part.
Preoccupation with work is another characteristic of high need-achievers.
They think about it on their way to the workplace, during lunch, and at home.
acquired needs
framework
Centers on the needs for
achievement, affiliation,
and power
need for achievement
The desire to accomplish
a task or goal more
effectively than was done
in the past
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182
PART 2 | Individual Behaviors and Processes in Organizations
They find it difficult to put their work aside, and they become frustrated when
they must stop working on a partly completed project. If Mark seldom thinks
about his business in the evening, he may not be a high need-achiever. However, if work is always on his mind, he might indeed be a high need-achiever.
Finally, high need- achievers tend to assume personal responsibility for
getting things done. They often volunteer for extra duties and find it difficult
to delegate part of a job to someone else. Accordingly, they derive a feeling of
accomplishment when they have done more work than their peers without the
assistance of others. Suppose Mark visits a store one da y and finds that the
merchandise is poorly displayed, the floor is dirty, and the sales clerks don’t
seem motivated to help customers. If he has a low need for ac hievement, he
might point the problems out to the store manager and then lea ve. But if his
need for achievement is high, he may very well stay in the store for a while ,
personally supervising the changes that need to be made.
Although high need-ac hievers tend to be successful, they often do not
achieve top management posts . The most common explanation is that
although high need for ac hievement helps these people advance quic kly
through the ranks, the traits associated with the need often conflict with the
requirements of high-level management positions. Because of the amount of
work they are expected to do, top executives must be able to delegate tasks to
others. In addition, they seldom receive immediate feedbac k, and they often
must make decisions that are either more or less risky than those with whic h
a high need-achiever would be comfortable.33 High need-achievers tend to do
well as individual entrepreneurs with little or no group reinforcement. Bill
Gates, cofounder of Microsoft, Reed Hasting, founder and CEO of Netflix, and
Marissa Mayer, CEO of Yahoo! are all recognized as being high need-achievers.
The Need for Affiliation
Individuals also experience the need for affiliation—the need for human companionship.34 Researchers recognize several ways that people with a high need
for affiliation differ from those with a lower need. Individuals with a high need
tend to want reassurance and approval from others and usually are genuinely
concerned about others’ feelings. They are likely to act and think as they believe
others want them to, especially those with whom they strongly identify and
desire friendship. As we might expect, people with a strong need for a
­ ffiliation
most often work in jobs with a lot of interpersonal
contact, such as sales and teaching positions.
For example, suppose that Watanka Jackson is
seeking a job as a geologist or petroleum field­engineer,
a job that will take her into remote areas for long periods of time with little interaction with coworkers. Aside
from her academic training, one ­reason for the nature
of her job search might be that she has a low need for
affiliation. In contrast, a classmate of hers, William Pfeffer, may be seeking a job in the corporate headquarters
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need for affiliation
The need for human
companionship
Some people are motivated by a need for power. This need, in turn,
may prompt them to seek impressive job titles and lavish offices such
as this one. Titles and offices are seen as ways to convey to others
how much power a person has.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
183
CHAPTER 5 | Motivating Behavior
of a petroleum company. His preferences might be dictated, at least in part, by
a desire to be around other people in the workplace; thus, he has a higher need
for affiliation. A recent Gallup survey suggests that people who have at least one
good friend at work are much more likely to be highly engaged with their work
and to indicate higher levels of job satisfaction.35
TUULIJUMALA/SHUTTERSTOCK.COM
The Need for Power
The third so-called acquired need is the need for power—the desire to control one’s environment, including financial, material, informational, and human
resources.36 People vary greatly along this dimension. Some individuals spend
much time and energy seeking power; others avoid power if at all possible. People with a high need for power can be successful managers if three conditions
are met. First, they must seek power for the betterment of the organization
rather than for their own interests. Second, they must have a fairly low need for
affiliation because fulfilling a personal need for power may well alienate others
in the workplace. Third, they need plenty of self-control to curb their desire for
power when it threatens to interfere with effective organizational or interper sonal relationships.37 Our Understand Yourself feature will give you personal
insights into how you may be motivated by these acquired needs.
need for power
The desire to control
the resources in one’s
environment
U N D E R S TA N D Y O U R S E L F
WHAT MOTIVATES YOU?
For each of the following fifteen statements, circle the
number that most closely agrees with how you feel.
Consider your answers in the context of your current job
or past work experience.
1.
I work very hard to continually improve my work performance.
1
2
3
4
5
2.
I enjoy competition. I like to win in sports and other things I do.
1
2
3
4
5
3.
When working, I often chat with fellow employees about nonwork matters.
1
2
3
4
5
4.
I enjoy difficult challenges. At work, I like to take on the hard jobs.
1
2
3
4
5
5.
I enjoy being a manager. I like being in charge of things and people.
1
2
3
4
5
6.
It is important to me to be liked by other people.
1
2
3
4
5
7.
When I am working, I like to know how I am doing and how the work is progressing.
1
2
3
4
5
8.
If I disagree with someone, I let them know it. I am not afraid of disagreement.
1
2
3
4
5
9. Many of my coworkers are also my friends. I enjoy spending my leisure time with them.
1
2
3
4
5
10.
I typically set realistic goals and tend to achieve them.
1
2
3
4
5
11.
It is important to me to get others to agree with my ideas.
1
2
3
4
5
12.
I enjoy belonging to clubs, groups, and other organizations.
1
2
3
4
5
13.
I enjoy the satisfaction of successfully completing a difficult job.
1
2
3
4
5
14.
One of my important objectives is to get more control over events around me.
1
2
3
4
5
15.
I would rather work with other people than work alone.
1
2
3
4
5
(Continued)
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184
PART 2 | Individual Behaviors and Processes in Organizations
Scoring: Record your score for each of the fifteen statements on the appropriate line below, putting your response
to the first statement on the top left line marked “1,” your
Achievement
response to the second statement on the top middle line
marked “2,” and so on. Then add up each column to learn
your achievement, power, and affiliation scores.
Power
Affiliation
_____
2.
_____
3.
_____
4. _____
5.
_____
6.
_____
7.
_____
8.
_____
9.
_____
10.
_____
11. _____
12.
_____
13.
_____
14. _____
15.
_____
TOTALS: _____
_____
1.
_____
Use the following values to guide your interpretation of each of the totals:
5 = very low; 10 = low; 15 = moderate; 20 = high; 25 = very high
Q u e s t i o n : How do you think your motivations
influence the way that you lead or that you will lead in the
future?
Source: From Journal of Vocational Behavior, 9(2),
Steers, R., & Braunstein, D. A Behaviorally Based Measure of
Manifest Needs in Work Settings, pp. 251–266.
PROCESS-BASED PERSPECTIVES ON
MOTIVATION
process-based
perspectives
Focus on how people
behave in their efforts to
satisfy their needs
Process-based perspectives are concerned with how motivation occurs. Rather
than attempting to identify specific motivational stimuli, such as pay or recognition, process perspectives focus on why people choose certain behavioral options
to satisfy their needs (regardless of the needs themselves) and how they evalu ate their satisfaction after they have attained these goals. Two useful process
perspectives on motivation are the equity and expectancy theories.
The Equity Theory of Motivation
equity theory
Focuses on people’s
desire to be treated
with what they perceive
as equity and to avoid
perceived inequity
equity
The belief that we are
being treated fairly in
relation to others; inequity
is the belief that we are
being treated unfairly in
relation to others
The equity theory of motivation is based on the relatively simple premise
that people in organizations w ant to be treated fairly. 38 The theory defines
equity as the belief that we are being treated fairly in relation to others and
inequity as the belief that we are being treated unfairly compared with oth ers. Equity theory is just one of several theoretical formulations derived from
social comparison processes. Social comparisons involve evaluating our own
situation in terms of others’ situations . In this c hapter, we focus mainly on
equity theory because it is the most highly developed of the social comparison
approaches and the one that applies most directly to the work motivation of
people in organizations.
Forming Equity Perceptions
People in organizations form perceptions of the equity of their treatment
through a four-step process. First, they evaluate how they are being treated by
the firm. Second, they form a perception of how a “comparison-other” is being
treated. The comparison-other might be a person in the same workgroup,
someone in another part of the organization, or even a composite of several
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 5 | Motivating Behavior
people scattered throughout the organization.39 Third, they compare their own
circumstances with those of the comparison-other and then use this compari son as the basis for forming an impression of either equity or inequity. Fourth,
depending on the strength of this feeling, the person may choose to pursue one
or more of the alternatives discussed in the next section.
Equity theory describes the equity comparison process in terms of an
input-to-outcome ratio. Inputs are an individual’s contributions to the orga nization—such factors as education, experience, effort, and loyalty. Outcomes
are what the person receives in return—pay, recognition, social relationships,
intrinsic rewards, and similar things. In effect, then, this part of the equity
process is essentially a personal assessment of one’ s psychological contract.
A person’s assessments of inputs and outcomes for both self and others are
based partly on objective data (for example, the person’s own salary) and
partly on perceptions (suc h as the comparison-other’s level of recognition).
The equity comparison thus takes the following form:
Outcomes (self)
Outcomes (other)
compared with
Inputs (self) Inputs (other)
If the two sides of this psychological equation are comparable, the person
experiences a feeling of equity; if the two sides do not balance, a feeling of inequity results. We should stress, however, that a perception of equity does not
require that the perceived outcomes and inputs be equal, but only that their
ratios be the same. A person may believe that his comparison-other deserves
to make more money because she works harder , thus making her outcomes
(higher pay) acceptable because it is proportional to her higher input (harder
work). Only if the other person’s outcomes seem disproportionate to her inputs
does the comparison provoke a perception of inequity.
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Responses to Equity and Inequity
Figure 5 .4 s ummarizes the r esults o f a n e quity c omparison. I f a p erson
feels equitably treated, she is generally motivated to maintain the status
quo. For example, she will continue to provide the same level of input to the
­organization as long as her outcomes do not c hange and the ratio of
inputs and outcomes of the comparison-other do not
change. But a person who is experiencing
inequity—real or imagined—is ­motivated to
reduce it. Moreover, the greater the inequity,
the stronger the level of motivation.
People ma y use one of six common
­methods to reduce inequity.40 First, we may
change our own inputs . Thus, we ma y put
more or less effort into the job , depending on
which way the inequity lies, as a way to alter
Perceptions of equity or inequity can play a strong role in
motivating an individual. Take these two colleagues, for
example. If she feels that she is equitably rewarded relative
to him, then she may be motivated to maintain the status
quo and be a productive and loyal employee. But if he feels
that he is being inequitably rewarded relative to her, he may
be motivated to ask for a raise or look for another job.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
185
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PART 2 | Individual Behaviors and Processes in Organizations
Figure 5.4
People form equity
perceptions by comparing
their situation with that
of someone else’s. If they
perceive equity, they are
motivated to maintain the
current situation. If they
perceive inequity, they
are motivated to use one
or more of the strategies
shown here to reduce the
inequity.
Responses to Perceptions of Equity and Inequity
Comparison of Self with Other
Inequity
Equity
Motivation to Reduce Inequity:
1. Change Inputs
2. Change Outcomes
3. Alter Perceptions of Self
4. Alter Perception of Other
5. Change Comparisons
6. Leave Situation
Motivation to Maintain
Current Situation
our ratio. If we believe we are being underpaid, for example, we may decide
not to work as hard.
Second, we may change our own outcomes. We might, for example, demand
a pay raise, seek additional a venues for growth and development, or even
resort to stealing as a way to “get more” from the organization. Or we might
alter our perceptions of the value of our current outcomes , perhaps by deciding that our present level of job security is greater and more valuable than we
originally thought.
A third, more complex response is to alter our perceptions of ourselves and
our behavior. After perceiving an inequity, for example, we may change our
original self-assessment and decide that we are really contributing less but
receiving more than we originally believed. For example, we might decide that
we are not really working as many hours as we had first thought—admitting,
perhaps, that some of our time spent in the office is really just socializing and
not actually contributing to the organization.
Fourth, we may alter our perception of the comparison-other’ s inputs or
outcomes. After all, much of our assessment of other people is based on perceptions, and perceptions can be changed. For example, if we feel underrewarded,
we may decide that our comparison-other is working more hours than we
originally believed—say by coming in on weekends and taking work home at
night.
Fifth, we ma y change the object of comparison. We may conclude, for
instance, that the current comparison-other is the boss’s personal favorite, is
unusually lucky, or has special skills and abilities . A different person would
thus provide a more valid basis for comparison. Indeed, we might change comparison-others fairly often.
Finally, as a last resort, we may simply leave the situation. That is, we
might decide that the only way to feel better about things is to be in a different
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CHAPTER 5 | Motivating Behavior
187
situation altogether. Transferring to another department or seeking a new job
may be the only way to reduce the inequity.
Evaluation and Implications
Most research on equity theory has been narrowly focused, dealing with only
one ratio—between pay (hourly and piece-rate) and the quality or quantity
of worker output given overpayment and underpayment.41 Findings support the predictions of equity theory quite consistently, especially when the
worker feels underpaid. When workers being paid on a piece-rate basis experience inequity, they tend to reduce their inputs by decreasing quality and
tend to increase their outcomes by producing more units of work. When a
person paid by the hour experiences inequity, the theory predicts an increase
in quality and quantity if the person feels overpaid and a decrease in qual ity and quantity if the person feels underpaid. Research provides stronger
support for responses to underpayment than for responses to overpayment;
overall, however, most studies appear to uphold the basic premises of the
theory. One interesting new twist on equity theory suggests that some peo ple are more sensitive than others to perceptions of inequity. That is, some
people pay a good deal of attention to their relative standing within the organization. Others focus more on their own situation without considering the
situations of others.42
Social comparisons clearly are a powerful factor in the workplace . For
managers, the most important implication of equity theory concerns organizational rewards and reward systems. Because “formal” organizational rewards
(pay, task assignments, and so forth) are more easily observable than “informal” rewards (intrinsic satisfaction, feelings of accomplishment, and so forth),
they are often central to a person’s perceptions of equity.
Equity theory offers managers three messages . First, everyone in the
organization needs to understand the basis for rewards. If people are to be
rewarded more for the quality of work rather than for quantity of work, for
instance, that fact needs to be c learly communicated to everyone . Second,
people tend to take a multifaceted view of their rewards; they perceive and
experience a variety of rewards, some tangible and others intangible. Finally,
people base their actions on their perceptions of reality. If two people make
exactly the same salary but each thinks the other makes more, each will base
his or her experience of equity on the perception, not the reality. Hence, even
if a manager believes two employees are being fairly rewarded, the employees
themselves may not necessarily agree if their perceptions differ from the manager’s. Our Improve Your Skills feature will help you better understand the
complexities of equity and fairness in the workplace.
The Expectancy Theory of Motivation
Expectancy theory is a more encompassing model of motivation than equity
theory (Expectancy theory is also known as VIE theory). Over the years since
its original formulation, the theory’s scope and complexity have continued to grow.
The Basic Expectancy Model
Victor Vroom is generally credited with first applying the theory to motivation
in the workplace.43 The theory attempts to determine how individuals choose
among alternative behaviors. The basic premise of expectancy theory is that
expectancy theory
Suggests that people are
motivated by how much
they want something
and the likelihood they
perceive of getting it
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PART 2 | Individual Behaviors and Processes in Organizations
IMPROVE YOUR SKILLS
FRAMING EQUITY AND FAIRNESS
This exercise will provide you with insights into how different people may frame equity and fairness and how you as
a manager may need to help people address these framing issues.
Assume that you are a manager of a group of professional employees in the electronics industry. Ray Lambert,
one of your employees, asks to meet with you. The company
has just announced an opening for a team leader position in
your group, and you know that Ray wants the job. You are
unsure as to how to proceed. Ray feels that he has earned
the opportunity on the basis of his consistently positive work
record, but you see things a bit differently. Since you hired
him about ten years ago he has been a solid but not an outstanding employee. As a result, he has consistently received
average performance evaluations, pay increases, and so
forth. He actually makes somewhat less money today than a
couple of other people with less tenure in the group because
they have had stronger performance records.
You really want to appoint another employee, Margot Sylvant, to the job. She has worked for the firm
only six years, but during that time she has consistently
been your top performer. You want to reward her performance, and you think she will do an excellent job as
team leader. On the other hand, you don’t want to lose
Ray, a solid member of the group. In anticipation of both
your upcoming meeting with Ray and how things will
work out after you appoint Margot, perform the following activities.
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1. Itemize the inputs and outcomes for both Ray and Margot. Think beyond the simple items described here and
note other likely inputs and outcomes.
2. Describe how Ray and Margot are likely to see the
situation.
3. Outline a conversation with Ray in which you convey
your decision to hire Margot for the new position.
4. Note what advice you might offer to Margot about
interacting with Ray in the future.
5. Identify other possible rewards you might offer Ray to
keep him motivated.
motivation depends on how much we want something and how likely we think
we are to get it.
A simple example further illustrates this premise. Suppose a recent 24-yearold college graduate is looking for her first managerial job . While scanning
online job postings she sees that Apple is seeking a new executive vice president
to oversee its foreign operations. The starting salary is $2,000,000. The student
would love the job, but she does not bother to apply because she recognizes that
she has no chance of getting it. Reading on, she sees a position that involves
scraping bubble gum from underneath desks in college c lassrooms. The starting pay is $9.25 an hour, and no experience is necessary. Again, she is unlikely
to apply—even though she assumes she could get the job, she does not want it.
Then she comes across a posting for a management training position with a
successful large company known for being an excellent place to work.No experience
is necessary, the primary requirement is a college degree, and the starting salary is
$50,000. She will probably apply for this position because (1) she w ants it and (2)
she thinks she has a reasonable chance of getting it. (Of course, this simple example
understates the true complexity of most choices. Job-seeking students may have
strong geographic preferences, have other job opportunities, and also be considering
graduate school. Most decisions of this type, in fact, are quite complex.)
Figure 5.5 summarizes the basic expectancy model. The model’s general
components are effort (the result of motivated beha vior), performance, and
outcomes. Expectancy theory emphasizes the linkages among these elements,
which are described in terms of expectancies, instrumentalities, and valences.
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CHAPTER 5 | Motivating Behavior
189
Figure 5.5
The Expectancy Theory of Motivation
Environment
Outcome
Effort
Effort-toPerformance
Expectancy
Performance
Performanceto-Outcome
Instrumentality
Outcome
Valence of
Outcomes
Outcome
Ability
Effort-to-Performance Expectancy
Effort-to-performance expectancy is a person’s perception of the probability that effort will lead to successful performance. If we believe our effort will
lead to higher performance, this expectancy is very strong, perhaps approaching a probability of 1.0, where 1.0 equals absolute certainty that the outcome
will occur. If we believe our performance will be the same no matter how much
effort we make, our expectancy is very low—perhaps as low as 0, meaning that
there is no probability that the outcome will occur. A person who thinks there
is a moderate relationship between effort and subsequent performance—the
normal circumstance—has an expectancy somewhere between 1.0 and 0. Alex
Morgan, a star soccer player who believes that when she puts forth maximum
effort she has a great chance of scoring higher than any opponent, clearly sees
a link between her effort and performance. (Some versions of this theory simply call this component expectancy.)
Performance-to-Outcome Instrumentality
Performance-to-outcome instrumentality (also known as performance-tooutcome expectancy) is a person’ s perception of the probability that perfor mance will lead to certain other outcomes. If a person thinks a high performer
is certain to get a pay raise, this instrumentality is close to 1.0. At the other
extreme, a person who believes raises are entirely independent of performance
has an instrumentality close to 0. Finally, if a person thinks performance has
some bearing on the prospects for a pa y raise, his or her instrumentality is
somewhere between 1.0 and 0. In a work setting, several performance-tooutcome instrumentalities are relevant because, as Figure 5.5 shows, several
outcomes might logically result from performance.
Each outcome, then, has its own instrumentality. Green Bay Packers quarterback Aaron Rodgers may believe that if he plays aggressively all the time
(performance), he has a great chance of leading his team to the playoffs. Playing aggressively may win him individual honors like the Most Valuable Player
award, but he may also experience more physical trauma and throw more
interceptions. (All three anticipated results are outcomes.)
The expectancy theory is
the most complex model
of employee motivation in
organizations. As shown
here, the key components
of expectancy theory
are effort-to-performance
expectancy, performanceto-outcome instrumentality,
and outcomes, each of
which has an associated
valence. These components
interact with effort, the
environment, and the
ability to determine an
individual’s performance.
effort-to-performance
expectancy
A person’s perception of
the probability that effort
will lead to performance
performance-to-outcome
instrumentality
The individual’s
perception of the
probability that
performance will lead to
certain outcomes
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190
PART 2 | Individual Behaviors and Processes in Organizations
outcome
Anything that results from
performing a particular
behavior
valence
The degree of
attractiveness or
unattractiveness a
particular outcome has
for a person
Outcomes and Valences
An outcome is anything that might potentially result from performance .
High-level performance conceivably might produce suc h outcomes as a pa y
raise, a promotion, recognition from the boss, fatigue, stress, or less time to
rest, among others. The valence of an outcome is the relative attractiveness
or unattractiveness—the value—of that outcome to the person. Pay raises,
promotions, and recognition might all have positive valences, whereas fatigue,
stress, and less time to rest might all have negative valences.
The strength of outcome valences varies from person to person. Workrelated stress may be a significant negative factor for one person but only
a slight annoyance to another. Similarly, a pay increase may have a strong
positive valence for someone desperately in need of money, a slight positive
valence for someone interested mostly in getting a promotion, or—for someone
in an unfavorable tax position—even a negative valence!
The basic expectancy framework suggests that three conditions must be
met before motivated behavior occurs. First, the effort-to-performance expectancy must be well above zero. That is, the worker must reasonably expect
that exerting effort will produce high levels of performance . Second, the
performance-to-outcome instrumentalities must be well above zero. In other
words, the person must believe that performance will realistically result in
valued outcomes. Third, the sum of all the valences for the potential out comes relevant to the person must be positive. One or more valences may be
negative as long as the positives outweigh the negatives. For example, stress
and fatigue may have moderately negative valences, but if pay, promotion,
and recognition have very high positive valences, the overall valence of the
set of outcomes associated with performance will still be positive.
Conceptually, the valences of all relevant outcomes and the corresponding
pattern of expectancies and instrumentalities are assumed to interact in an
almost mathematical fashion to determine a person’s level of motivation. Most
people do assess likelihoods of and preferences for various consequences of
behavior, but they seldom approach them in such a calculating manner.
The Porter-Lawler Model
The original presentation of expectancy theory placed it squarely in the mainstream of contemporary motivation theory. Since then, the model has been
refined and extended many times. Most modifications have focused on identifying and measuring outcomes and expectancies. An exception is the variation
of expectancy theory developed by Lyman Porter and Edward Lawler. These
researchers used expectancy theory to develop a novel view of the relationship
between employee satisfaction and performance.44 Although the conventional
wisdom was that satisfaction leads to performance, Porter and Lawler argued
the reverse: If rewards are adequate, high levels of performance may lead to
satisfaction.
The Porter-Lawler model appears in Figure 5.6. Some of its features are
quite different from the original version of expectancy theory. For example, the
extended model includes abilities, traits, and role perceptions. At the beginning of the motivational cycle, effort is a function of the value of the potential
reward for the employee (its valence) and the perceived effort-reward probability (an expectancy). Effort then combines with abilities , traits, and role
perceptions to determine actual performance.
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CHAPTER 5 | Motivating Behavior
191
Figure 5.6
The Porter-Lawler Model
Value of
Reward
Intrinsic
Rewards
Abilities
and Traits
Effort
Role
Perceptions
Perceived
Effort-Reward
Probability
Performance
Perceived
Equity
of Rewards
Satisfaction
Extrinsic
Rewards
The Porter and
Lawler expectancy
model provides
interesting insights
into the relationships
between satisfaction
and performance. As
illustrated here, this
model predicts that
satisfaction is determined
by the perceived equity
of intrinsic and extrinsic
rewards for performance.
That is, rather than
satisfaction causing
performance, which many
people might predict,
this model argues that it
is actually performance
that eventually leads to
satisfaction.
Source: Figure from Lyman W. Porter and Edward E. Lawler, Managerial Attitudes and Performance. Copyright ©
1968. McGraw-Hill, Inc. Used by permission of Lyman W. Porter.
Performance results in two kinds of rewards. Intrinsic rewards are intangible—a feeling of accomplishment, a sense of ac hievement, and so forth.
Extrinsic rewards are tangible outcomes such as pay and promotion. The individual judges the value of his or her performance to the organization and uses
social comparison processes (as in equity theory) to form an impression of the
equity of the rewards received. If the rewards are regarded as equitable, the
employee feels satisfied. In subsequent cycles, satisfaction with rewards influences the value of the rewards anticipated, and actual performance following
effort influences future perceived effort-reward probabilities.
Evaluation and Implications
Expectancy theory has been tested by many different researc hers in a variety
of settings and using a variety of methods .45 As noted earlier, the complexity of the theory has been both a blessing and a curse .46 Nowhere is this
double-edged quality more apparent than in the research undertaken to evaluate the theory. Several studies have supported various parts of the theory. For
example, expectancies, instrumentalities, and valence have been found to be
associated with effort and performance in the workplace.47 Research has also
confirmed expectancy theory’s claims that people will not engage in motivated
behavior unless they (1) value the expected rew ards, (2) believe their efforts
will lead to performance, and (3) believe their performance will result in the
desired rewards.48
However, expectancy theory is so complicated that researchers have found
it quite difficult to test. In particular, the measures of various parts of the
model may lack validity, and the procedures for investigating relationships
among the variables have often been less scientific than researc hers would
like. Moreover, people are seldom as rational and objective in c hoosing behaviors as expectancy theory implies. Still, the logic of the model, combined with
the consistent, albeit modest, research support for it, suggests that the theory
has much to offer.
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192
PART 2 | Individual Behaviors and Processes in Organizations
CASE STUDY
Pride-Building at Aramark
Aramark, a leader in professional services headquartered in Philadelphia, has approximately
270,000 employees serving clients in twenty-two
countries.50 Aramark wanted to better motivate its
employees who clean airplanes for Delta and
Southwest Airlines. Turnover of the low-paid staff
of largely immigrant employees once exceeded
100 percent a year. Morale was low, and wallets
and other valuable items that passengers left on
planes had a tendency to disappear.
To turn things around, Aramark manager Roy
Pelaez believed that he had to break some rules
to get employees to feel motivated. “Managers
are not supposed to get involved with the personal problems of their employees, but I take the
opposite view,” he says. “Any problem that affects
the employee will eventually affect your account.
If you take care of the employees, they will take
care of you and your customer.” Besides the typical “Employee of the Month” recognition programs, he brought in an English-language teacher
to tutor employees twice a week on their own
time, added Friday citizenship classes to help
employees become U.S. citizens, and arranged
for certified babysitters subsidized by government
programs to keep single mothers showing up for
work. He even created a small computer lab with
three used computers so that employees could
train each other in word processing and spreadsheets. “All of these things are important, because
we want employees who really feel connected to
the company,” says Pelaez.
Employees who had perfect attendance over
a six-month period or who turned in a wallet or
pocketbook filled with cash and credit cards were
rewarded with a day off with pay. Workers in the
“Top Crew of the Month” were rewarded with
movie passes, telephone calling cards, or “burger
bucks.” Turnover fell to 12 percent per year—
amazing for jobs that pay only minimum wage to
start. And crews started to recover large amounts
of money from the airplanes, returning to passengers some 250 lost wallets with more than
$50,000 in cash.51
In five years, Pelaez’s efforts helped to
increase Aramark’s revenue in this area from
$5 million to $14 million. 52 Since 1998, programs such as these have helped Aramark consistently rank as one of the top three most
admired companies in its industry in Fortune
magazine’s list of “America’s Most Admired
Companies.”53
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Research has also suggested that expectancy theory is more likely to
explain motivation in the United States than in other countries . People from
the United States tend to be very goal oriented and tend to think that they can
influence their own success. Thus, under the right combinations of expectancies, instrumentalities, valences, and outcomes, they will be highly motivated.
But different ­patterns may exist in other countries. For example, people from
some cultures may believe that God determines the outcome of every behavior
so the concept of expectancy or instrumentality would not be very applicable.49
Because expectancy theory is so complex, it is difficult to apply directly
in the workplace. A manager would need to figure out what rew ards each
employee wants and how valuable those rew ards are to eac h person, measure the various expectancies , and finally adjust the relationships to cre ate m
­ otivation. Nevertheless, expectancy theory offers several important
Questions:
1. What motivation theories apply to the workers
at Aramark?
2. If you were the manager of these employees,
what would you do to motivate them? Be honest regarding your personal management
style and beliefs rather than trying to be like
Roy Pelaez.
3. What are some possible barriers to the effectiveness of your motivation ideas? What could
you do to overcome them?
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CHAPTER 5 | Motivating Behavior
193
guidelines for the practicing manager. The following are some of the more fundamental guidelines:
1. Determine the primary outcomes each employee wants.
2. Decide what levels and kinds of performance are needed to meet organizational goals.
3. Make sure the desired levels of performance are possible.
4. Link desired outcomes and desired performance.
5. Analyze the situation for conflicting expectancies and instrumentalities.
6. Make sure the rewards are large enough.
7. Make sure the overall system is equitable for everyone.54
LEARNING-BASED PERSPECTIVES
ON MOTIVATION
Learning is another key component in employee motivation. We discussed
learning styles in Chapter 3,and now we examine learning from thep
­ erspective
of motivation. In any organization, employees quickly learn which behaviors
are rewarded and which are ignored or punished. Thus, learning plays a critical role in maintaining motivated behavior. Learning is a ­relatively permanent change in behavior or behavioral potential that results from direct or
indirect experience. For example, we can learn to use a new ­software application program by practicing and experimenting with its v
­ arious functions and
options.
learning
A relatively permanent
change in behavior or
behavioral potential
resulting from direct or
indirect experience
How Learning Occurs
The Traditional View: Classical Conditioning
The most influential historical approach to learning is classical conditioning,
developed by Ivan Pavlov in his famous experiments with dogs .55 Classical
conditioning is a simple form of learning in whic h a conditioned response is
linked with an unconditioned stimulus. In organizations, however, only simple
behaviors and responses can be learned in this manner. For example, suppose
an employee receives very bad news one da y from his boss. It’s possible that
the employee could come to associate, say, the color of the boss’s suit that day
with bad news. Thus, the next time the boss wears that same suit to the office,
the employee may experience dread and foreboding.
But this form of learning is obviously simplistic and not directly relevant
to motivation. Learning theorists soon recognized that although classical conditioning offered some interesting insights into the learning process , it was
inadequate as an explanation of human learning. For one thing, classical conditioning relies on simple cause-and-effect relationships between one stimulus and one response; it cannot deal with the more complex forms of learned
behavior that typify human beings. For another, classical conditioning ignores
the concept of choice; it assumes that behavior is reflexive, or involuntary.
Therefore, this perspective cannot explain situations in which people con sciously and rationally choose one course of action from among many. Because
of these shortcomings of classical conditioning, theorists eventually moved on
classical conditioning
A simple form of learning
that links a conditioned
response with an
unconditioned stimulus
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194
PART 2 | Individual Behaviors and Processes in Organizations
to other approaches that seemed more useful in explaining the processes associated with complex learning.
The Contemporary View: Learning as a Cognitive Process
Although it is not tied to a single theory or model, contemporary learning theory generally views learning as a cognitive process; that is, it assumes that
people are conscious, active participants in how they learn.56
First, the cognitive view suggests that people draw on their experiences
and use past learning as a basis for their present beha vior. These experiences represent knowledge, or cognitions. For example, an employee faced
with a choice of job assignments will use previous experiences in decid ing which one to accept. Second, people make choices about their behavior.
The employee recognizes that she has two alternatives and c hooses one.
Third, people recognize the consequences of their c hoices. Thus, when the
employee finds the job assignment rewarding and fulfilling, she will recognize that the choice was a good one and will understand why. Finally, people
evaluate those consequences and add them to prior learning , which affects
future choices. Faced with the same job choices next year, the employee will
probably be motivated to choose the same one. As implied earlier, several
perspectives on learning take a cognitive view. Perhaps foremost among
them is reinforcement theory. Although reinforcement theory per se is not
really new, it has only been applied to organizational settings in the last
few years.
Reinforcement Theory and Learning
reinforcement theory
Based on the idea that
behavior is a function of
its consequences
Reinforcement theory (also called “operant conditioning”) is generally associated with the work of B. F. Skinner.57 In its simplest form, reinforcement
theory suggests that behavior is a function of its consequences. 58 ­Behavior
that results in pleasant consequences is more likely to be repeated (the
employee will be motivated to repeat the current beha vior), and behavior
that results in unpleasant consequences is less likely to be repeated (the
employee will be motivated to engage in different beha viors). Reinforcement
theory also suggests that in any given situation, people explore a variety
of possible behaviors. Future behavioral choices are affected by the conse quences of earlier behaviors. Cognitions, as already noted, also play an
important role. Therefore, rather than assuming the mechanical stimulusresponse linkage suggested by the traditional classical view of learning,
contemporary theorists believe that people consciously explore different
behaviors and systematically choose those that result in the most desirable
outcomes.
Suppose a new employee wants to learn the best way to get along with
his boss. At first, the employee is very friendly and informal, but the boss
responds by acting aloof and, at times, annoyed. Because the boss does not
react positively, the employee is unlikely to continue this beha vior. In fact,
the employee next starts acting more formal and professional and finds
the boss much more receptive to this posture. The employee will probably
continue this new set of beha viors because they have resulted in positive
consequences. We will examine how these processes work in more detail,
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CHAPTER 5 | Motivating Behavior
195
but first let’s consider one more basic aspect of learning based on the experiences of others.
Social Learning
social learning
When people observe
the behaviors of
others, recognize the
consequences, and alter
their own behavior as a
result
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In recent years , managers ha ve begun to recognize the power of social
­learning. Social learning occurs when people observe the behaviors of others,
­recognize their consequences, and alter their own behavior as a result (some
experts refer to social learning as social cognitive theory). A person can learn
to do a new job by observing others or by w atching videos. Or an employee
may learn to a void being late by seeing the boss c hew out fellow workers .
Social learning theory, then, suggests that individual behavior is determined
by a person’s cognitions and social environment. More specifically, people are
presumed to learn behaviors and attitudes at least partly in response to what
others expect of them.
Several conditions must be met to produce an appropriate environment for
social learning. First, the behavior being observed and imitated must be rela tively simple. Although we can learn by watching someone else how to push
three or four buttons to set specifications on a machine or to turn on a computer, we probably cannot learn a complicated sequence of operations for the
machine or how to run a complex software package without also practicing the
various steps ourselves. Second, social learning usually involves observed and
imitated behavior that is concrete, not intellectual. We can learn by watching
others how to respond to the different beha viors of a particular manager or
how to assemble a few component parts into a final assembled product. But
we probably cannot learn through simple observation how to write computer
software, how to write complicated text, how to conceptualize, or how to think
abstractly. Finally, for social learning to occur, we must possess the physical
ability to imitate the behavior observed. Most of us, even if we watch t­ elevised
baseball games or tennis matc hes every
weekend, cannot hit a fastball like Miguel
Cabrera or execute a backhand like
Serena Williams.
Social learning influences motivation
in a ­variety of ways. Many of the behaviors we exhibit in our daily work lives
are learned from others . Suppose a new
employee joins an existing workgroup . She
already has some basis for knowing how
to behave from her education and previous
Social learning occurs when people observe the
behaviors of others, recognize the consequences, and
alter their won behavior as a result. This individual is
getting a reward and promotion. His co-workers may
now be motivated to perform their jobs in the same
way as him.
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196
PART 2 | Individual Behaviors and Processes in Organizations
experience. However, the group provides a set of very specific cues she can use to
­tailor her behavior to fit her new situation. The group may indicate how the organization expects its members to dress, how people are “supposed” to feel about the
boss, and so forth. Hence, the employee learns how to behave in the new situation
partly in response to what she already knows and partly in response to what others suggest and demonstrate.
Behavior Modification
behavior modification
The application of
reinforcement theory to
influence the behaviors of
people in organizational
settings
Learning theory alone has important implications for managers, but organizational behavior modification has even more practical applications. B
­ ehavior
modification is the application of reinforcement theory to influence the
behaviors of people in organizational settings.59 One aspect of behavior modification is the use of various kinds of reinforcement when employees are
observed behaving in desired or undesired ways. Figure 5.7 summarizes these
kinds of reinforcement. We will now discuss these different kinds of reinforce ment in more detail, and then look at different times to apply time.
Kinds of Reinforcement
There are four types of reinforcers, as shown in Figure 5.7. Positive reinforcement involves the use of rew ards to increase the likelihood that a desired
behavior—high performance, for instance—will be repeated. For example,
when a manufacturing employee wears uncomfortable but important safety
gear, the manager can give the employee praise to increase the likelihood that
the employee will wear the safety equipment in the future . Positive reinforcement has been used at a Sears Department Store in Pennsylvania. A manager
was having a difficult time getting his staff to prompt customers to apply for
credit cards. He offered employees a bonus on their pa ycheck for every credit
card application that was processed. In addition, every 90 days, the employee
with the most submitted applications would be recognized at work and receive
a gift card. As a result, the Sears store became the number one store for credit
card applications in the state.
Figure 5.7
Individual behavior
can be affected when
stimulus is either
presented or removed
after a particular
behavior. This is also
dependent on whether
the stimulus is positive
or negative.
Types of Reinforcers60
Nature of the Stimulus
Positive
Action Present the
Stimulus
Remove the
Stimulus
Positive reinforcement;
increases the behavior
Negative
Punishment; decreases
the behavior
Extinction; decreases the Negative reinforcement;
behavior
increases the behavior
Sources: Based on B. Lachman, F. Camm, & S. A. Resetar, Integrated Facility Environmental Management­
Approaches: Lessons from Industry for Department of Defense Facilities, 2001. Santa Monica, CA: RAND Corporation.
http://www.rand.org/pubs/monograph_reports/MR1343/.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 5 | Motivating Behavior
Negative reinforcement is based on the removal of current or future
unpleasant consequences to increase the likelihood that someone will repeat
a behavior. In other words, avoidance or removal of something undesirable
can be motivating. For example, suppose a piece of hazardous manufacturing equipment is set so that when it is turned on the machine operator hears
a continuous loud buzzer. After the machine operator runs a series of safety
checks the buzzer stops. Because the machine operator wants the buzzer to
stop she or he is motivated to engage in safe work beha viors (running the
safety checks). If an employee has a long or unpleasant commute, allowing her
to work from home one or two days a week if her performance stays high can
also be rewarding and motivate good performance.
Punishment is the application of negative outcomes to decrease the likelihood of
a behavior. For example, a manager might reduce the work hours of low-performing
employees. Other common forms of punishment include verbal and written reprimands, formal disciplinary activities, and reduced involvement in decision making.
Because of a variety of consequences that can follow punishment, most organizations rely on rules and policies to govern the use of punishment.
Finally, extinction involves the removal of other reinforcement (positive or
negative) following the incidence of the behavior to be extinguished to decrease
the likelihood of that beha vior being repeated. For example, suppose that a
manager laughs at an off-color joke told by an employee. The laughter serves
as positive reinforcement so the employee may continue to tell off-color jokes.
The manager realizes that this could lead to trouble and w ants the employee
to stop. The manager can begin ignoring the jokes. Over time, the lack of a
positive reaction from the manager reduces the employee’s motivation and the
behavior is extinguished.
For reinforcement to work, people must associate the rew ard with the
behavior. In other words, people need to know exactly why they are receiving
a reward. To best reinforce a behavior, the reward should come as quickly as
possible after the behavior. The reward can be almost anything, and does not
need to cost a lot of money, but it must be something desired by the recipient.
Some of the most powerful rewards are symbolic—things that cost very little
but mean a lot to the people who get them. Examples of symbolic rewards are
things like plaques or certificates.
Rewards also impact ethical behavior choices. Although multiple studies have shown that incentives can increase unethical behavior,61 the effects
of rewards and punishments on ethical behavior are complex. Rewards do
not always increase ethical behavior because the presence of the reward can
undermine the intrinsic value of the ethical behavior.62 Providing economic
incentives for voluntary helping behavior undermines people’s motivation for
engaging in it.63 Because the presence of sanctions makes it more likely that
individuals will view a decision from a more narrow, business-driven framework rather than an ethical decision-making framework, weak sanctions can
undermine ethical behavior more than no sanctions at all.64 Instead of choosing a course of action based on what is right, the decision becomes an evaluation of whether the unethical behavior is “worth” the risk of the punishment.
The Timing of Reinforcement
As noted above, reinforcement should ideally come immediately after the behavior bring influenced. For a variety of reasons, though, this may not always be
possible. Therefore, it is useful to understand the various schedules that can be
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197
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PART 2 | Individual Behaviors and Processes in Organizations
used to provide reinforcement. A continuous reinforcement schedule is one in
which the desired behavior is reinforced each time that it occurs. A partial reinforcement schedule is one in which the desired behavior is reinforced only part
of the time. There are four types of partial reinforcement schedules:
1. Fixed-ratio: Desired behavior is reinforced after a specified number of correct responses—for example, receiving pay bonuses for every ten error-free
pieces made per hour.
2. Fixed-interval: Desired behavior is reinforced after a certain amount of
time has passed—for example, receiving weekly paychecks.
3. Variable-ratio: Desired behavior is reinforced after an unpredictable number of behaviors—for example, a supervisor praises a call center representative after the third call, then the seventh call after that, and then the
fourth call after that.
4. Variable-interval: Desired behavior is reinforced after an unpredictable
amount of time has elapsed—for example , not knowing when a regional
supervisor will visit your location for an inspection.
Fixed-ratio schedules produce a high, consistent rate of responding with
desired behaviors but with fast extinction when the reinforcement stops .
Fixed-interval schedules produce high performance near the end of the inter val, but lower performance immediately after the reinforcement occurs. Variable-ratio schedules produce a high, steady rate of responding with desired
behaviors and the behaviors are difficult to extinguish. With variable-interval
schedules, the behavior of the individual does not influence the a vailability of
reinforcement so it has a minimal effect on motivation.
Research suggests that the fastest w ay to get someone to learn is to use
continuous reinforcement and reinforce the desired beha vior every time it
occurs. The downside to this approach is that as soon as the reward is stopped,
the desired behavior decreases in frequency (extinction). The most effective
schedule for sustaining a behavior is variable reinforcement. This requires
reinforcing the desired behavior every few times it occurs, around some average number of times, rather than every time it occurs. Because performing
the behavior could result in a rew ard at any time, this approach is a strong
motivator of beha vior. A good example of variable reinforcement is a slot
machine—players know that their machine will eventually pay out, but they
do not know when, so they are motivated to continue playing for a long time
even when they are losing and not being reinforced.
In terms of behavior modification, any behavior can be understood as being
a result of its consequences. In other words, as a manager, you get whatever
behaviors you are rewarding. If an employee continually comes to work late ,
it is because you are not providing the right positive consequences for coming
to work on time, the negative consequences for coming in late are inappropri ate, or both. To motivate the right behavior, an expert in behavior modification
would identify the desired behaviors and then carefully reinforce them. This
process involves five steps:65
1. Define the problem—what is it that could be improved?
2. Identify and define the specific behavior(s) you wish to change.
3. Record and track the occurrence of the target behavior.
4. Analyze the current negative consequences of the undesired beha vior and
arrange for more positive consequences to follow the desired behavior.
5. Evaluate whether the behavior has improved, and by how much.
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CHAPTER 5 | Motivating Behavior
199
This chapter has covered a variety of theories that can be used by man agers to motivate employee performance. Table 5.1 summarizes how different motivation concepts covered in this chapter can be applied to a variety
of common management challenges. Understanding why and how a motivational perspective works helps managers better matc h motivational techniques with motivation opportunities and enhances the likelihood of success.
In Chapter 6 we will explore in more detail different ways that work and
rewards can be used to motivate employee performance. These motivational
methods, techniques, and programs are derived from the various theories
discussed in this c hapter, but also provide more operational guidance for
managers.
Table 5.1
Different motivation concepts and theories can be applied to various managerial challenges to
enhance employee motivation.
Managerial
Challenges
Motivation Theories
Herzberg’s
McClelland’s Two-Factor
Self-Efficacy Needs Theory Theory
Firm has a low-cost
business strategy
but needs to
motivate employees
x
An employee feels
he cannot meet his
performance goals
x
x
x
Expectancy Equity
Theory
Theory
x
x
Reinforcement
x
x
x
An employee feels
underpaid relative
to her coworkers
x
x
An employee
engages in
inappropriate
behavior (bullying,
ridiculing coworkers)
A talented
employee is not
feeling challenged
at work
x
x
Because the work
is repetitive, some
employees find it
boring and hard to
stay motivated
x
x
x
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200
PART 2 | Individual Behaviors and Processes in Organizations
SUMMARY AND APPLICATION
REAL W O R LD R E S PO N S E
MOTIVATING CAST MEMBERS AT DISNEY
To motivate cast members at Disney theme parks to
subsequent reward or recognition. Cast members
provide exemplary customer service, the company
are encouraged to give “Great Service Fanatic”
begins by thoroughly training new hires in topics
cards to fellow Cast Members when they see each
ranging from performance expectations, to how to
other going above and beyond to deliver outstand-
dress, to how to anticipate guests’ needs. Cast mem-
ing service. After receiving a card, the Cast Member
bers are then rewarded daily by managers and cast
must have it signed by his/her manager to inform
members with verbal complements, written praise,
him or her of the praise. Disney believes that this
and other monetary and nonmonetary rewards.
type of praise is the key to building a highly moti-
Because it is easiest to be motivated and perform
vated workforce and making guests happy.67
well on a job we are good at, Disney also uses per-
Whatever the reward given, Disney feels strongly
formance evaluations to put cast members in the best
that the purpose must be clear and motivational. Dis-
job for their unique talents.66
ney uses a variety of rewards, from a numbered bot-
Disney believes that the key to rewards is the fre-
tle of green tabasco sauce to an entry in a drawing
quency and the immediacy with which they are
for a family Disney cruise, to motivate employees to
administered. Disney tries to avoid time lags between
maintain a high level of service quality and idea
when an employee does a good deed and the
generation.68
LOSKUTNIKOV/SHUTTERSTOCK.COM
Motivation is the set of forces that cause people to beha ve as they do. Motivation starts with a need. People search for ways to satisfy their needs and then
behave accordingly. Their behavior results in rewards or punishment. To varying degrees, an outcome may satisfy the original need. Scientific management
asserted that money is the primary human motivator in the workplace . The
human relations view suggested that social factors are primary motivators .
Individual differences can play an important role in motivation.
According to Abraham Maslow, human needs are arranged in a hierarchy
of importance, from physiological to security to belongingness to esteem to ,
finally, self-actualization. The ERG theory is a refinement of Maslow’ s original hierarchy that includes a frustration-regression component. In Herzberg’s
two-factor theory, satisfaction and dissatisfaction are two distinct dimensions
instead of opposite ends of the same dimension. Motivation factors are pre sumed to affect satisfaction and hygiene factors are presumed to affect dis satisfaction. Herzberg’s theory is well known among managers but has several
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CHAPTER 5 | Motivating Behavior
deficiencies. Other important acquired needs include the needs for achievement, affiliation, and power.
The equity theory of motivation assumes that people want to be treated
fairly. It hypothesizes that people compare their own input-to-outcome ratio in
the organization with the ratio of a comparison-other. If they feel their treatment has been inequitable, they take steps to reduce the inequity. Expectancy
theory, a somewhat more complicated model, follows from the assumption that
people are motivated to work toward a goal if they want it and think that they
have a reasonable chance of achieving it. Effort-to-performance expectancy
is the belief that effort will lead to performance . Performance-to-outcome
instrumentality is the belief that performance will lead to certain outcomes .
Valence is the desirability to the individual of the various possible outcomes
of performance. The Porter-Lawler version of expectancy theory provides useful insights into the relationship between satisfaction and performance . This
model suggests that performance may lead to a variety of intrinsic and extrinsic rewards. When perceived as equitable, these rewards lead to satisfaction.
Learning also plays a role in employee motivation. Various kinds of reinforcement provided according to different schedules can increase or decrease
motivated behavior. People are affected by social learning processes. Organizational behavior modification is a strategy for using learning and reinforcement
principles to enhance employee motivation and performance . This strategy
relies heavily on the effective measurement of performance and the provision
of rewards to employees after they perform at a high level.
DISCUSSION QUESTIONS
1. When has your level of performance been directly affected by your motivation? By your ability? By the environment?
2. Identify examples from your own experience that support, and others that
refute, Maslow’s hierarchy of needs theory.
3. Have you ever experienced inequity in a job or a class? How did it affect you?
4. Which is likely to be a more serious problem—perceptions of being
­underrewarded or perceptions of being overrewarded?
5. Do you think expectancy theory is too complex for direct use in organizational settings? Why or why not?
6. Do the relationships between performance and satisfaction suggested by Porter
and Lawler seem valid? Cite examples that both support and refute the model.
7. Think of occasions on whic h you experienced eac h of the four types of
reinforcement.
8. Identify the five forms of reinforcement that you receive most often (i.e .,
wages, grades, etc.). On what schedule do you receive each of them?
UNDERSTAND YOURSELF
Managerial Motivation Skills
The goal of this exercise is to better understand and develop your managerial
motivation skills. After you are assigned a partner, decide who will play the
role of manager and who will pla y the role of the subordinate . The subordinate’s task is to fold a paper airplane out of a single sheet of paper that flies
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201
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PART 2 | Individual Behaviors and Processes in Organizations
farther than any other paper airplane made in the c lass. Your instructor will
give the subordinate a confidential role assignment that is NO T to be shared
with the manager. After reading the role sheet, the subordinate will act out
the situation described in the role assignment. As the subordinate, DO NOT
tell the manager what you will be doing—just act it out by beha ving as a real
employee would in the situation you have been assigned. The subordinate is
responsible for folding the airplane under the supervision of the manager.
As the manager, your job is to identify the motivational problem, analyze
the situation, and try different strategies to motivate the subordinate. As
the subordinate, your job is to realistically portray the employee in the role
description and respond realistically to the manager’s attempts at increasing
your motivation and changing your behavior.
When the instructor indicates, stop the role play. The subordinate should then
show the manager his or her role assignment and talk about what the ­manager
did well and less well in trying to analyze and improve the situation. Give honest,
constructive feedback to help your partner improve his or her managerial skills.
Now switch roles, and the instructor will give the new subordinate a dif ferent role assignment. Repeat the process, including giving feedback to the
manager when the exercise is complete.
GROUP EXERCISE
Motivating Your Sales Staff
The goal of this exercise is to give you practice aligning individual and organizational goals, and thinking like a manager in managing employee motivation.
After dividing into groups of four to five students, read the scenario below:
Imagine that you are the management team of a new high-end retail clothing store named Threads. Your company’s business strategy is to provide highquality customer service and to provide high-quality products. You are not
the cheapest store in town, but you expect your employees to create a service- ­
oriented atmosphere that customers will be willing to pay a little extra for.
You recognize that your sales staff will be essential to your store’ s success, and you want to create a system that motivates them to help create a
competitive advantage for your business. Because this is the first store you
have opened, you have some latitude to decide how to best motivate your staff.
Market competitive starting salaries have already established, but you have
decided to allocate 10 percent of the store’ s profits to use to motivate your
sales staff in any way you see fit.
Working as a team, discuss your answers to the following questions. Be
prepared to share your answers with the class.
Questions
1. What behaviors would you want from your sales staff?
2. What goals would you set for your sales staff , given your answer to
question 1?
3. What type of system would you set up to reward these behaviors?
4. What challenges would you be on the lookout for? How would you proactively address these potential c hallenges to prevent them from
happening?
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CHAPTER 5 | Motivating Behavior
203
VIDEO EXERCISE
Mike Boyle Strength & Conditioning
Mike Boyle is the co-owner and manager of Mike Boyle Strength and Condi tioning, a gym based in Woburn, Massachusetts. Mike’s vision for his gym is
that it is a place where he and his staff enjoy spending their time and do not
really see their jobs as “work.” Rather, he wants everyone to see the gym simply as a place they go each day to help people.
Mike Boyle Strength & Conditioning employs a number of people performing in multiple roles. For example, one of his staff members serves as both a
personal trainer and a nutritionist. Another serves as both a personal training
and a sports masseuse. Mike himself, along with his co-founder, also work as
personal trainers in addition to managing the gym.
Mike understands that the fitness industry is characterized by high turnover. Some trainers are simply working while they pursue other career oppor tunities. Others move from gym to gym. Consequently, he focuses on trying to
motivate his staff to both grow and develop as fitness professionals while also
seeing his gym as a place they want to stay.
Watch the video “Mike Boyle Strength & Conditioning” as a class. Next, form
small groups with 3-4 of your classmates and develop responses to these questions.
Questions
Now What?
Imagine working in a group with two other members asked by your boss
to brainstorm names for a new product. The other two members stop after
quickly generating three to four weak ideas and want to quit. One group member doesn’t see the point of the task. The other group member c laims to not
be good at this kind of creative stuff and would rather get bac k to work doing
something else. What do you say or do? Go to this chapter’s “Now What?” video,
watch the challenge video, and choose a response. Be sure to also view the outcomes of the two responses you didn’t choose.
PERCOM/SHUTTERSTOCK.COM
1. Can you relate Mike Boyle’s views on employee motivation to the need
theories discussed in this class? If so, how?
2. How does expectancy theory explain Ana’s view of her work at Mike
Boyle’s Strength & Conditioning?
3. Marco speaks about the pride he takes in both his work and the gym.
Describe how his pride can be explained by any of the eed perspectives
on motivation.
4. How do Bob’s ideas about training and learning relate to employee
motivation?
VIDEO C A S E
Discussion Questions
1. Which aspects of motivation discussed in this chapter are illustrated
in these videos? Explain your answer.
2. What do you feel is the biggest c hallenge facing this team in the
­challenge video?
3. As a manager, what motivational tec hniques would you apply in this
situation?
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204
PART 2 | Individual Behaviors and Processes in Organizations
ENDNOTES
1 Company Overview, Disney, 2015.
Available online: ­
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16Amabile, T., & Kramer, S. (2010, January–February). What
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46 Pinder, C . (2008).
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55Pavlov, I. P. (1927). Conditional Reflexes. New York: Oxford
University Press.
56 Bandura, A. (2001). Social Cognitive Theory: An Agentic
­Perspective. Annual Review of Psychology, 52, 1–26.
57Skinner, B. F. (1953). Science and Human Behavior. New
York: Macmillian; and Skinner, B. F. (1972). Beyond Freedom
and Dignity. New York: Knopf.
58Luthans, F., & Kreitner, R. (1985). Organizational Behavior
Modification and Beyond. Glenview, IL: Scott, Foresman.
59Luthans, F., & Kreitner, R. (1975). Organizational ­Behavior
Modification. Glenview, IL: Scott Foresman; Luthans, F., &
Kreitner, R. (1985). Organizational Behavior Modification
and Beyond. Glenview, IL: Scott, Foresman.
60Lachman, B., Camm, F., & Resetar, S. A. (2001). Integrated
Facility Environmental Management Approaches: Lessons
from Industry for Department of Defense F acilities. Santa
Monica, CA: RAND Corporation. Available online: http://www.
rand.org/pubs/monograph_reports/MR1343/.
61Ashkanasy, N. M., Windsor, C. A., & Treviño, L. K. (2006).
Bad Apples i n B ad B arrels R evisited: C ognitive M oral
Development, Just World Beliefs, Rewards, and Ethical
Decision Making. Business Ethics Quarterly, 16, 449–474;
Treviño, L. K., & Youngblood, S. A. (1990). Bad Apples
in Bad Barrels: A Causal Analysis of Ethical Decision
Making Behavior. ­Journal of Applied Psychology, 75(4),
447–476.
62Treviño, L. K., & Youngblood, S. A. (1990). Bad Apples in
Bad Barrels: A Causal Analysis of Ethical Decision Making
­Behavior. Journal of Applied Psychology, 75(4), 447–476.
63 Frey, B . S ., & Oberholzer -Gee, F. (1997). The Cost of
Price Incentives: An Empirical Analysis of Motivation
­Crowding-Out. American Economic Review, 87(4), 746–755.
64Tenbrunsel, A. E., & Messick, D. M. (2004). Ethical ­Fading:
The Role of Self-Deception in Unethical Beha vior. Social
­Justice Research, 17(2), 223–235.
65 The following is based on: Connellan, T. (1978). How to
Improve Human Performance: Behaviorism in Business. New
York: Harper & Row; Miller, L. (1978). Behavior Management:
The New Science of Managing People at Work (p. 253). New
York: John Wiley and Sons.
49Adler, N. (2007). International Dimensions of Organizational
66 Kalogridis, G. (2010). Chain of Excellence . Leadership
­Excellence, 27(8), 7.
50Aramark 2015 Fact Sheet. (2015). Available online: http://
67 James, J. (2012, April 19). Encouraging and Motivating
Leaders, Talking Point: The Disney Institute Blog . Available online: http://disneyinstitute.com/blog/blog_posting.
aspx?bid=52#.T7ENCOvLxNM.
Behavior (5th ed.). Cincinnati, OH: Southwestern Publishing.
www.aramark.com/~/media/Files/aramark-fun-facts.
ashx?la=en.
51 Byrne, J. A. (2003, August). How to Lead Now: Getting
Extraordinary Performance When You Can’t Pay for It. Fast
Company, 73, 62.
68 Ligos, M. (2009). How Mickey Makes Magic. Successful
­Promotions, 42(5), 44–47.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
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CHAPTER
6
MOTIVATING BEHAVIOR WITH
WORK AND REWARDS
Real World Challenge: Orchestrating
Outcomes
CHAPTER
OUTLINE
JOB DESIGN
Job Specialization
Basic Alternatives to Job
Specialization
Job Characteristics Theory
Improve Your Skills: Enriching Jobs
for Employee Motivation
EMPLOYEE PARTICIPATION AND
EMPOWERMENT
Areas of Employee
Participation
Approaches to Participation and
Empowerment
Global Issues: Participation Around the
World
FLEXIBLE WORK ARRANGEMENTS
Variable Work Schedules
Extended Work Schedules
Flexible Work Schedules
Alternative Workplaces
After studying this chapter, you should be
able to:
LEARNING
OUTCOMES
1 Identify and describe different
approaches to job design and relate
each to motivation.
2 Discuss employee participation,
empowerment, and flexible work
arrangements and identify how they
can impact motivation.
GOAL SETTING AND MOTIVATION
Goal-Setting Theory
Broader Perspectives on Goal Setting
Goal Setting Challenges
PERFORMANCE MANAGEMENT
Purposes of Performance Appraisal
Elements of Performance Management
Understand Yourself: Your Feedback
Style
The Balanced Scoreboard Approach
to Performance Management
INDIVIDUAL REWARDS IN
ORGANIZATIONS
Roles, Purposes, and Meanings of
Rewards
Case Study: The Whole Truth
Types of Rewards
Related Issues in Rewarding
Performance
SUMMARY AND APPLICATION
Real World Response: Orchestrating
Outcomes
3 Describe the goal setting
theory of motivation and discuss
broader perspectives on goal
setting.
4 Discuss performance management
and its role in motivation.
5 Describe how organizations use
various kinds of rewards to motivate
employees.
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ORCHESTRATING OUTCOMES
Reviewing a concert by the Orpheus Chamber Orchestra, New York Times music critic Vivien
Schweitzer wrote that the orchestra played Robert Schumann’s Symphony No. 2 “with remarkable coordination”; the “balance among strings, winds, and brass,” she added, “was impressively well proportioned.” Was Schweitzer, as we sometimes say, damning with faint praise?
Isn’t a symphony, which means “harmony of sounds,” supposed to be played with remarkable
coordination? Aren’t the various sections of the orchestra supposed to be well balanced? Had
the conductor, whose job is to ensure a consummate performance of the music, achieved little
more than coordination and balance? Actually, New York–based Orpheus doesn’t play with
a conductor, and Schweitzer was remarking on the fact that the orchestra had “bravely—and
successfully—attempted” such a complex work without the artistic and managerial leadership
of someone who directs rehearsals and stands at a podium waving an authoritative baton.
“For us at Orpheus,” explains executive director Graham Parker, “it’s the way we make
the music that’s the difference.” Orpheus holds to the principle that its product—the music performed for audiences—is of the highest quality when its workers—the musicians—are highly
satisfied with their jobs. All professional orchestra musicians, of course, are highly trained and
skilled, but make no mistake about it: A lot of them are not very happy workers. An organizational psychologist at Harvard surveyed workers in 13 different occupational categories, including orchestra players, to determine relative levels of job motivation and satisfaction. On the one
hand, musicians ranked at the top in motivation, “fueled by their own pride and professionalism,” according to this study. But when it came to general satisfaction with their jobs, orchestra
players ranked seventh (just below federal prison guards and slightly above beer sales and
delivery teams). On the question of satisfaction with growth opportunities, they ranked ninth
(again, below prison guards, though a little higher than O.R. nurses and hockey players).1 An
orchestra leader has asked you how to imitate the Orpheus’s success. After ­reading this chapter
you will have some suggestions on how to do this.
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REAL WORLD CHALLENGE
HIROYUKI ITO/HULTON ARCHIVE/GETTY IMAGES
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208
PART 2 | Individual Behaviors and Processes in Organizations
Chapter 5 described a variety of perspectives on motivation. But no single
theory or model completely explains motivation—eac h covers only some
of the factors that actually result in motivated beha vior. Moreover, even if
one theory were applicable in a particular situation, a manager might still
need to translate that theory into operational terms. Thus, while using the
actual theories as tools or frameworks, managers need to understand various operational procedures, systems, and methods for enhancing motivation
and performance.
Figure 6.1 illustrates a basic framework for relating various theories of
motivation to potential and actual motivation and to operational methods
for translating this potential and actual motivation into performance. The
left side of the figure illustrates that motivated behavior can be induced by
need-based or process-based circumstances. That is, people may be motivated to satisfy various specific needs or through various processes suc h
as perceptions of inequity, expectancy relationships, and reinforcement
contingencies.
These need-, process-, and learning-based concepts result in the situation
illustrated in the center of the figure—a certain potential exists for motivated
behavior directed at enhanced performance . For example, suppose that an
employee wants more social relationships—that is, he wants to satisfy belongingness, relatedness, or affiliation needs. This means that there is potential
for the employee to want to perform at a higher level if he thinks that higher
performance will satisfy those social needs . Likewise, if an employee’s high
performance in the past was followed by strong positive reinforcement, there
is again a potential for motivation directed at enhanced performance.
Figure 6.1
Managers can use a
variety of methods to
enhance performance
in organizations. The
need- and processbased perspectives on
motivation explain some
of the factors involved in
increasing the potential
for motivated behavior
directed at enhanced
performance. Managers
can then use such
means as goal setting,
job design, flexible
work arrangements,
performance
management, rewards,
and organizational
behavior motivation
to help translate this
potential into actual
enhanced performance.
Enhancing Performance in Organizations
Job Design
Need-Based
Perspectives on
Motivation
Employee
Participation
Potential for Motivated
Behavior Directed at
Enhanced Performance
Flexible Work
Arrangements
Enhanced
Performance
Goal Setting
Process-Based
Perspectives on
Motivation
Performance
Management
Organizational
Rewards
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CHAPTER 6 | Motivating Behavior with Work and Rewards
209
But managers may need to take certain steps to translate the potential
for motivation directed at enhanced performance into real motivation and
enhanced performance. In some cases, these steps may be tied to the specific
need or process that has created the existing potential. For example, providing
more opportunities for social interaction contingent on improved performance
might capitalize on an employee’s social needs. More typically, however, a
manager needs to go further to help translate potential into real performance.
The right side of Figure 6.1 names some of the more common methods used
to enhance performance. This chapter covers these six methods: job design,
employee participation and empowerment, flexible work arrangements, goal
setting, performance management, and organizational rewards.
JOB DESIGN IN ORGANIZATIONS
Job design is an important method managers can use to enhance employee
performance.2 When work design is addressed at the individual level,it is most
commonly referred to as job design; it can be defined as how o­ rganizations
define and structure jobs. As we will see, properly designed jobs can ha ve a
positive impact on the motivation, performance, and job satisfaction of those
who perform them. On the other hand, poorly designed jobs can impair motivation, performance, and job satisfaction. The first widespread model of how
individual work should be designed w as job specialization. For example, a
worker who applies safety decals to a piece of equipment as that equipment
moves down an assembly line is performing a specialized job.
Job Specialization
job specialization
Breaking jobs down into
small component tasks
and standardizing them
across all workers doing
those jobs
RA
MONTY
KUSEN
/GETTY
IMAGES
Frederick Taylor, the chief proponent of job specialization, argued that jobs
should be scientifically studied, broken down into small component tasks, and
then standardized across all workers doing those jobs.3 Taylor’s view grew from
the historical writings about division of labor advocated by Scottish
economist Adam Smith. In practice, job special ization generally brought most, if not all, of the
advantages its advocates claimed. ­Specialization
paved the way for large-scale assembly lines and
was at least partly r­ esponsible for the dramatic
gains in output U.S. industry achieved for several
decades in the early 1900s.
On the surface , job specialization appears
to be a rational and efficient way to structure
jobs. The jobs in many factories, for instance, are
highly specialized and are often designed to maximize productivity. In practice, however, performing
job design
How organizations define
and structure jobs
Job specialization involves carefully studying jobs, breaking
those jobs down into small component tasks, and then
standardizing how those tasks should be performed across
all workers performing the jobs. These workers are following
standard procedures in how they perform their specialized jobs.
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210
PART 2 | Individual Behaviors and Processes in Organizations
those jobs can cause problems, foremost among them the extreme monotony
of highly specialized tasks. Consider the job of assembling toasters. A person
who does the entire assembly may find the job complex and challenging, albeit
inefficient. If the job is specialized so that the worker simply inserts a heating
coil into the toaster as it passes along on an assembly line, the p
­ rocess may
be efficient, but it is unlikely to interest or c hallenge the worker. A worker
numbed by boredom and monotony may be less motivated to work hard and
more inclined to do poor-quality work or to complain about the job. For these
reasons, managers began to search for job design alternatives to specialization.
Basic Alternatives to Job Specialization
In response to problems with job specialization, and a general desire to explore
ways to create less monotonous jobs, managers began to seek alternative ways
to design jobs. Managers initially developed two alternative approaches, job
rotation and job enlargement. These approaches, along with job enrichment,
remain common today.
Job Rotation
Job rotation involves systematically shifting workers from one job to another
to sustain their motivation and interest. Under specialization, each task is
broken down into small parts. For example, assembling fine writing pens such
as those made by Mont Blanc or Cross might involve four discrete steps: testing the ink cartridge, inserting the cartridge into the barrel of the pen, screwing the cap onto the barrel, and inserting the assembled pen into a box. One
worker might perform step one, another step two, and so forth.
When job rotation is introduced, the tasks themselves stay the same. However, the workers who perform them are systematically rotated across the vari ous tasks. Jones, for example, starts out with task 1 (testing ink cartridges). On
a regular basis—perhaps weekly or monthly—she is systematically rotated to
task 2, to task 3, to task 4, and back to task 1. Gonzalez, who starts out on task
2 (inserting cartridges into barrels), rotates ahead of Jones to tasks 3, 4, 1, and
back to 2.
Unfortunately, job rotation does not entirely address issues
of monotony and boredom, however.4 That is, if a rotation
cycle takes workers through the same old jobs,
the workers simply experience several routine
and boring jobs instead of just one . Although
a worker ma y begin eac h job shift with a bit of
renewed interest, the effect usually is short-lived.
Rotation may also decrease efficiency. For example,
it sacrifices the proficiency and expertise that grow
from ­specialization. At the same time, job rotation
is an effective training technique because a worker
CAROL
SHUTT INA K. SMITH,
ERSTOC
M
K.COM .D./
job rotation
Systematically moving
workers from one job to
another in an attempt to
minimize monotony and
boredom
Job rotation involves systematically shifting workers from one job to
another. While job rotation was intended to sustain motivation and
interest, it really does little to address the problems of monotony and
boredom created by job specialization. The TSA rotates airport screeners
regularly, though, in an effort to keep them focused on their jobs.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 6 | Motivating Behavior with Work and Rewards
211
rotated through a variety of related jobs acquires a larger set of job skills .
Thus, there is increased flexibility in transferring workers to new jobs. Many
U.S. firms now use job rotation for training or other purposes, but few rely on
it to motivate workers. Pilgrim’s Pride, one of the largest chicken-processing
firms in the United States, uses job rotation, but not for motivation. Workers
in a chicken-processing plant are subject to cumulative trauma injuries such
as carpal tunnel syndrome, and managers at Pilgrim’s believe that rotating
workers across different jobs can reduce these injuries. The TSA also rotates
airport security screeners across different tasks every 20–30 minutes to help
prevent boredom and to keep them focused on their jobs.
Job Enlargement
Job enlargement, or horizontal job loading , is expanding a worker’ s job
to include tasks previously performed by other workers . For instance, if job
enlargement were introduced at a Cross pen plant, the four tasks noted above
might be combined into two “larger” ones. Hence, one set of workers might each
test cartridges and then insert them into barrels (old steps 1 and 2); another
set of workers might then attac h caps to the barrels and put the pens into
boxes (old steps 3 and 4). The logic behind this change is that the increased
number of tasks in each job reduces monotony and boredom.
Maytag was one of the first companies to use job enlargement. 5 In the
assembly of washing machine water pumps, for example, jobs done sequentially by six workers at a conveyor belt were modified so that eac h worker
completed an entire pump alone. Other organizations that implemented job
enlargement included AT&T, the U.S. Civil Service, and Colonial Life Insurance Company. Unfortunately, job enlargement also failed to have the desired
effects. Generally, if the entire production sequence consisted of simple, easyto-master tasks, merely doing more of them did not significantly change the
worker’s job. If the task of putting two bolts on a piece of mac hinery was
“enlarged” to putting on three bolts and connecting two wires, for example, the
monotony of the original job essentially remained.
Job Enrichment
Job rotation and job enlargement seemed promising but eventually disap pointed managers seeking to counter the ill effects of extreme specialization.
They failed partly because they were intuitive, narrow approaches rather than
fully developed, theory-driven methods. Consequently, a new, more complex
approach to task design—job enrichment—was developed. Job enrichment is
based on the two-factor theory of motivation, which is discussed in Chapter 5.
That theory contends that employees can be motivated by positive job-related
experiences such as feelings of achievement, responsibility, and recognition.
To achieve these, job enrichment relies on vertical job loading—not only adding more tasks to a job, as in horizontal loading, but also giving the employee
more control over those tasks.6
AT&T, Texas Instruments, IBM, and General Foods have all used job
enrichment. For example, AT&T utilized job enric hment in a group of
eight people who were responsible for preparing service orders . Managers believed turnover in the group w as too high and performance too low.
Analysis revealed several deficiencies in the work. The group worked in
relative isolation, and any service representative could ask them to prepare
work orders. As a result, they had little client contact or responsibility, and
job enlargement
Involves giving workers
more tasks to perform
job enrichment
Entails giving workers
more tasks to perform
and more control over
how to perform them
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212
PART 2 | Individual Behaviors and Processes in Organizations
Job enrichment involves both giving workers more tasks to
perform and more control over how to perform them. This
clothing designer, for example, gets to select fabrics, develop
new designs, and then tailor the designs into new clothing.
WAVEB
RE
AKMED
IA/SHU
TTERST
OCK.CO
M
they received scant feedbac k on their job per formance. The job enrichment program focused
on creating a process team. Each member of the
team was paired with a service representative,
and the tasks were restructured: Ten discrete
steps were replaced with three more complex ones.
In addition, the group members began to get spe cific feedback on performance, and their job titles
were changed to reflect their greater responsibil ity an d st atus. As a re sult of the se c hanges, t he
number of orders delivered on time increased from
27 percent to 90 percent, accuracy improved, and
turnover decreased significantly.7 Texas Instruments
also used this technique to improve janitorial jobs. The company gave janitors more control over their sc hedules and let them sequence their own
cleaning jobs and purchase their own supplies. As a direct result, turnover
dropped, cleanliness improved, and the company reported estimated initial
cost savings of approximately $103,000.8
At the same time, we should note that many job enrichment programs have
failed. Some companies have found job enrichment to be cost ineffective, and
others believe that it simply did not produce the expected results .9 Several programs at Prudential Insurance, for example, were abandoned because managers
believed they were benefiting neither employees nor the firm. Some of the criticism is associated with flaws in the two-factor theory of motivation on which job
enrichment is based. Because of these and other problems , job enrichment is
not as popular as it was a few years ago. Yet some valuable aspects of the concept can be salvaged. The efforts of managers and academic theorists ultimately
have led to more complex and sophisticated viewpoints. Many of these advances
are evident in the job characteristics theory, which we consider next.
The Job Characteristics Theory
job characteristics theory
Uses five motivational
properties of tasks
and three critical
psychological to improve
outcomes
The job characteristics theory focuses on the specific motivational properties
of jobs. The theory, diagrammed in Figure 6.2, was developed by Hackman and
Oldham.10 At the core of the theory is the idea of critical psychological states. These
states are presumed to determine the extent to whic h characteristics of the job
enhance employee responses to the task. The three critical psychological states are:
1. Experienced meaningfulness of the work: the degree to which the individual experiences the job as generally meaningful, valuable, and worthwhile
2. Experienced responsibility for work outcomes: the degree to which individuals feel personally accountable and responsible for the results of their
work
3. Knowledge of results: the degree to whic h individuals continuously
­understand how effectively they are performing the job
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 6 | Motivating Behavior with Work and Rewards
213
Figure 6.2
The Job Characteristics Theory
Core Job
Dimensions
Critical
Psychological
States
Personal and
Work Outcomes
Experienced
Meaningfulness
of the Work
High Internal
Work Motivation
Skill Variety
Task Identity
Task Significance
Autonomy
Feedback
Experienced
Responsibility
for Outcomes
of the Work
Knowledge of the
Actual Results of
Work Activities
High-Quality
Work Performance
High Satisfaction
with the Work
The job characteristics
theory is an important
contemporary model
of how to design jobs.
By using five core job
characteristics, managers
can enhance three
critical psychological
states. These states,
in turn, can improve
a variety of personal
and work outcomes.
Individual differences
also affect how the job
characteristics affect
people.
Low Absenteeism
and Turnover
Strength of Employee's
Growth Needs
If employees experience these states at a sufficiently high level, they
are likely to feel good about themselves and to respond fa vorably to their
jobs. Hackman and Oldham suggest that the three critical psychological
states are triggered by the following five c haracteristics of the job, or core
job dimensions:
1. Skill variety: the degree to which the job requires a variety of activities
that involve different skills and talents
2. Task identity: the degree to which the job requires completion of a “whole”
and an identifiable piece of work; that is, the extent to which a job has a
beginning and an end with a tangible outcome
3. Task significance: the degree to whic h the job affects the lives or work
of other people, both in the immediate organization and in the external
environment
4. Autonomy: the degree to which the job allows the individual substantial
freedom, independence, and discretion to sc hedule the work and deter mine the procedures for carrying it out
5. Feedback: the d egree to w hich t he j ob a ctivities give the individual direct and clear information about the effectiveness of his or her
performance
Figure 6.2 shows that these five job characteristics, operating through the
critical psychological states, affect a variety of personal and work outcomes:high
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
PART 2 | Individual Behaviors and Processes in Organizations
IMPROVE YOUR SKILLS
ENRICHING JOBS FOR EMPLOYEE MOTIVATION
This exercise will help you assess the processes involved in
designing jobs to make them more motivating. To start,
your instructor will divide the class into groups of three or
four people each. In assessing the characteristics of jobs,
use a scale value of 1 (“very little”) to 7 (“very high”).
1.
2.
Using the scale values above, assign scores on each
core job dimension used in the job characteristics
theory (see below) to the following jobs: administrative
assistant, professor, food server, auto mechanic,
lawyer, short-order cook, department store clerk,
construction worker, newspaper reporter, and
telephone solicitor.
Researchers often assess the motivational properties
of jobs by calculating their motivating potential score
(MPS). The usual formula for MPS is
(Variety +Identity + Significance)
× Autonomy × Feedback
3
3.
4.
5.
6.
Use this formula to calculate the MPS for each job in
step 1.
Your instructor will now assign your group one of the
jobs from the list. Discuss how you might reasonably
go about enriching the job.
Calculate the new MPS score for the redesigned job
and check its new position in the rank ordering.
Discuss the feasibility of your redesign suggestions. In
particular, look at how your recommended changes
might necessitate changes in other jobs, in the reward
system, and in the selection criteria used to hire
people for the job.
Briefly discuss your observations with the rest of the class.
ILDOGESTO/SHUTTERSTOCK.COM
214
internal work motivation (that is, intrinsic motivation), high-quality work performance, high satisfaction with the work, and low absenteeism and turnover. The
figure also suggests that individual differences play a role in job design. People
with strong needs for personal growth and development will be especially moti vated by the five core job characteristics. On the other hand, people with weaker
needs for personal growth and development are less likely to be motivated by the
core job characteristics. Several firms, including 3M, Volvo, AT&T, Xerox, Texas
Instruments, and Motorola, have successfully implemented job design changes
using this theory.11 The Improve Your Skills feature will help you develop stronger insights into the complexities of how jobs can be redesigned.
Much research has been d evoted to this approach to job design. 12 This
research has generally supported the theory, although performance has seldom been found to correlate with job c haracteristics. 13 Several apparent
weaknesses in the theory have also come to light. First, the measures used
to test the theory are not alw ays as valid and reliable as they should be .
Further, the role of individual differences frequently has not been supported
by research. Finally, guidelines for implementation are not specific, so managers usually tailor them to their own particular circumstances . Still, the
theory remains a popular perspective on studying and changing jobs.14
EMPLOYEE PARTICIPATION AND
INVOLVEMENT
Employee motivation can also be enhanced in some cases through the use
of participation and empowerment. In a sense, participation and empowerment are extensions of job design because eac h fundamentally alters how
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 6 | Motivating Behavior with Work and Rewards
215
Participation and involvement are often used to promote worker
motivation. This executive, for example, is consulting with
one of his employees on how best to solve a problem.
employees in an organization perform their jobs.
­Participation occurs when employees ha ve a
voice in decisions about their own work. (One
important model that can help managers determine
the optimal level of employee participation, Vroom’s
decision-tree approach, is discussed in Chapter 12.)
Empowerment is the ­process of enabling workers to
set their own work goals, make decisions, and solve
problems within their spheres of responsibility and
authority. Thus, empowerment is a somewhat broader
concept that promotes participation in a wide variety
of areas, including but not limited to work itself, work
context, and work environment.15
The role of participation and empowerment in motivation can be expressed
in terms of both the need-based perspectives and the expectancy theory dis cussed in Chapter 5. Employees who participate in decision making ma y be
more committed to executing decisions properly. Furthermore, successfully
making a decision, executing it, and then seeing the positive consequences can
help satisfy one’s need for achievement, provide recognition and responsibility,
and enhance self-esteem. Simply being asked to participate in organizational
decision making may also enhance an employee’ s self-esteem. In addition,
­participation should help clarify expectancies (as a component of expectancy
theory, as discussed in Chapter 5).That is, by participating in decision ­making,
employees may better understand the linkage (instrumentality) between their
­performance and the rewards they want most.
M
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participation
Entails giving employees
a voice in making
decisions about their own
work
empowerment
The process of enabling
workers to set their
own work goals, make
decisions, and solve
problems within their
sphere of responsibility
and authority
Areas of Employee Participation
At one level, employees can participate in addressing questions and making
decisions about their own jobs . Instead of just telling them how to do their
jobs, for example, managers can ask employees to make their own decisions
about how to do them. Based on their own expertise and experience with their
tasks, workers might be able to improve their own productivity. In many situations, they might also be well qualified to make decisions about what materials to use, which tools to use, and so forth.
Chaparral Steel, a small steel producer near Dallas , allows its workers
considerable autonomy in how they perform their jobs. For example, when the
firm needed a new rolling mill lathe , it budgeted $1 million for its purc hase
and then put the purc hase decision in the hands of an operating mac hinist.
This machinist, in turn, investigated various options, visited other mills in
Japan and Europe, and then recommended an alternative piece of machinery
costing less than half of the budgeted amount. The firm also helped pioneer an
innovative concept called “open-book management”—any employee at Chaparral can see any company document, record, or other piece of information at
any time and for any reason.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
216
PART 2 | Individual Behaviors and Processes in Organizations
It might also help to let workers make decisions about administrative matters, such as work schedules. If jobs are relatively independent of one another,
employees might decide when to change shifts, take breaks, go to lunch, and
so forth. A workgroup or team might also be able to sc hedule vacations and
days off for all of its members. Furthermore, employees are getting increasing
opportunities to participate in broader issues of product quality. Involvement
of this type has become a hallmark of successful J apanese and other international firms, and many U.S. companies have followed suit.
Approaches to Participation and Empowerment
In recent years many organizations ha ve actively sought w ays to extend
employee participation and empowerment beyond the traditional areas. Simple techniques such as suggestion boxes and question-and-answer meetings
allow a certain degree of participation, for example. The basic motive has been
to better capitalize on the assets and capabilities inherent in all employees .
Thus, many managers today prefer the term “empowerment” to “participation”
because it implies a more comprehensive level of involvement.
One method some firms use to empower their workers is the use of work
teams. This method grew out of early attempts to use what J apanese firms
call “quality circles.” A quality circle is a group of employees who voluntarily
meet regularly to identify and propose solutions to problems related to quality.
Quality circles quickly evolved into a broader and more comprehensive arra y
of workgroups, now generally called “work teams.” These teams are collections
of employees empowered to plan, organize, direct, and control their own work.
Their supervisor, rather than being a traditional “boss,” plays more the role
of a coach. We discuss work teams more fully in Chapter 7. The other method
some organizations use to facilitate employee involvement is to c hange their
overall method of organizing. The basic pattern is for an organization to elim inate layers from its hierarchy, thereby becoming much more decentralized.
Power, responsibility, and authority are delegated as far down the organiza tion as possible, so control of work is squarely in the hands of those who actually do it.
Netflix has high performance standards for its employees as it competes
with Redbox, Amazon, and Apple in the video streaming and rental market.
The firm hires talented employees, pays them generously, focuses employees
on clear goals, and empowers them to do what they need to do to reac h their
goals.16 It even lets employees take as muc h vacation time as they w ant as
long as it does not interfere with their work.17 Patagonia also offers every
employee a lot of empowerment, which helps improve employee loyalty.18
Technology also helps organizations empower workers by making better
and timelier information available to everyone in the organization. Although
some employees are likely to feel more motivated when empowered, other
employees may not react positively. Increased responsibility does not ­motivate
everyone. Nonetheless, empowerment can be an important management tool
to increase the motivation of many employees . Practical ways to empower
­others include:19
•
•
Articulating a clear vision and goals
Fostering personal mastery experiences to enhance self-efficacy and build
skills
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 6 | Motivating Behavior with Work and Rewards
•
•
•
•
217
Modeling successful behaviors
Sending positive messages and arousing positive emotions in employees
Connecting employees with the outcomes of their work and giving them
feedback
Building employee confidence by showing competence, honesty, and fairness
GLOBAL
ISSUES
PARTICIPATION AROUND THE WORLD
Some people think that it was U.S. business that pioneered the use of work teams. Not true. One of the first
firms to use work teams was the Swedish (at the time)
automaker Volvo. Back in the mid-1970s Volvo designed
and built a totally different kind of factory in the town of
Kalmar, Sweden. Rather than relying on traditional
assembly lines, where workers stood along a moving
conveyor built and performed simple individual assembly
tasks to partially assembled cars moving along the belt,
the Kalmar factory moved platforms with partially assembled cars from one team area to another. As a platform
entered a team’s area, the team members worked
together as a team in completing a long list of tasks
assigned to that team. For the most part, each team
worked without direct supervision, set its own work pace,
and even took breaks in its own private break area complete with shower and locker facilities. Volvo’s logic for
this approach was that by empowering its employees
and allowing them to participate in making decisions
about their work, those employees would be more motivated and produce higher-quality products.
Japanese automakers like Toyota, Nissan, and
Honda also used teams long before their U.S. counterparts. The Japanese plants more closely resemble a
traditional assembly line arrangement, but workers still
function in teams and are not restricted to staying within
a defined space and not required to perform a specialized task. Instead, the workers within each team are
allowed to move from one work space to another, to
help one another out, to work on tasks together, and
to cover for a team member who needs a quick break.
Another hallmark of the Japanese system is that any
worker is empowered to stop the assembly line on his
or own authority if a problem is detected. This team-oriented approach, based on participation and empowerment, is often cited as a factor in the global dominance
of Japanese automobile companies, especially related
to product quality.
A key reason these approaches have worked so well
in Sweden and Japan is the close connection between performance and rewards. Most U.S. work systems are built
around individual contributions, individual performance
and individual rewards. But at Kalmar and in Japan, work
is centered around teams. So, too, are rewards. That is,
rewards and recognition are provided based on team
performance, rather than individual performance. As a
result, it is in the best interest of all team members to work
together as productively as possible.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
BALDYRGAN/SHUTTERSTOCK.COM
Regardless of the specific tec hnique used, however, empowerment only
enhances organizational effectiveness if certain conditions exist. First, the organization must be sincere in its efforts to spread power and autonomy to lower levels
of the organization. Token efforts to promote participation in just a few areas are
unlikely to succeed. Second, the organization must be committed to maintaining
participation and empowerment. Workers will be resentful if they are given more
control only to later have it reduced or taken away altogether. Third, the organization must be systematic and patient in its efforts to empower workers . Turning
over too much control too quickly can spell disaster. Finally, the organization must
be prepared to increase its commitment to training . Employees who are given
more freedom concerning how they work are likely to need additional training to
help them exercise that freedom most effectively . The Global Issues feature
provides some insights in participation and empowerment in other countries.
218
PART 2 | Individual Behaviors and Processes in Organizations
FLEXIBLE WORK ARRANGEMENTS
Beyond the actual redesigning of jobs and the use of employee involvement,
many organizations today are experimenting with a variety of flexible work
arrangements. These arrangements are generally intended to enhance
employee motivation and performance by giving workers more flexibil ity about how and when they work. Among the more popular flexible work
arrangements are variable work schedules, flexible work schedules, extended
work schedules, job sharing, and telecommuting.20
Variable Work Schedules
compressed work
schedule
Work schedule in which
employees work a full
forty-hour week in fewer
than the traditional five
days
There are many exceptions, of course, but the traditional professional work
schedule in the United States has long been days that start at 8:00 or 9:00 in
the morning and end at 5:00 in the evening, five days a week (and, of course,
managers and other professionals often work many additional hours outside
of these times). Although the exact starting and ending times vary, most companies in other countries have also used a well-defined work schedule. But
such a schedule makes it difficult for workers to attend to routine personal
business—going to the bank, seeing a doctor or dentist for a c heckup, having a parent-teacher conference, getting an automobile serviced, and so forth.
Employees locked into this work schedule may find it necessary to take a sick
or vacation day to handle these activities. On a more psychological level, some
people may feel so powerless and constrained by their job sc hedules that they
grow resentful and frustrated.
To help counter these problems , one alternative some businesses use is
a compressed work schedule.21 An employee following a compressed work
week schedule works a full forty-hour week in fewer than the traditional five
days. Most typically, this schedule involves working ten hours a da y for four
days, leaving an extra day off. Another alternative is for employees to work
slightly less than ten hours a day but to complete the forty hours by lunchtime
on Friday. Firms that have used these forms of compressed workweeks include
Recreational Equipment (REI), USAA, Edward Jones, and Mercedes-Benz
USA.22 One problem with this schedule is that if everyone in the organization
is off at the same time, the firm may have no one on duty to handle problems
or deal with outsiders on the off day. On the other hand, if a company staggers
days off across the workforce , people who don’t get the more desirable da ys
off (Monday and Friday, for most people) may be jealous or resentful. Another
problem is that when employees put in too much time in a single day, they
tend to get tired and perform at a lower level later in the day.
A popular schedule some organizations are beginning to use is called
a “nine-eighty” schedule. Under this arrangement, an employee works a
traditional schedule one week and a compressed schedule the next, g
­ etting
every other F riday off. That is, they work eighty hours (the equivalent
of two weeks of full-time work) in nine da ys. By alternating the regular
and compressed schedules across half of its workforce, the organization is
staffed at all times but still gives employees two additional full da ys off
each month. Chevron and Marathon Oil are two businesses that currently
use this schedule.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 6 | Motivating Behavior with Work and Rewards
Finally, a special form of compressed work schedule is job sharing. In
job sharing, two part-time employees share one full-time job. Job sharing may
be desirable for people who only want to work part time or when job markets are
tight. For its part, the organization can accommodate the preferences of a broader
range of employees and may benefit from the talents of more people. Perhaps the
simplest job-sharing arrangement to visualize is that of a receptionist. To share
this job, one worker would staff the receptionist’ s desk from, say, 8:00 a.m. to
noon each day; the office might close from noon to 1:00 p.m., and a second worker
would staff the desk from 1:00 p.m. in the afternoon until 5:00 p.m. To the casual
observer or visitor to the office, the fact that two people serve in one job is essen tially irrelevant. The responsibilities of the job in the morning and responsibilities
in the afternoon are not likely to be interdependent. Thus, the position can easily
be broken down into two or perhaps even more components.
219
job sharing
Two or more part-time
employees sharing one
full-time job
Extended Work Schedules
extended work schedule
Work schedule that
requires relatively long
periods of work followed
by relatively long periods
of paid time off
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In certain cases, some organizations use another type of work sc heduling
called an extended work schedule. An extended work schedule is one that
requires relatively long periods of work followed by relatively long periods of
paid time off. These schedules are most often used when the cost of transitioning from one worker to another is high and there are efficiencies associated
with having a small workforce.
For instance, KBR is a large defense contractor that manages U.S. military
installations in foreign countries, including Iraq and Afghanistan. KBR’s civilian
employees handle maintenance, logistics, and communications, as well as food,
laundry, and mail services, among other things. The typical work schedule for a
KBR employee is 12 hours a day, 7 days a week. Extended schedules such as this
allow the firm to function with a smaller workforce than would be the case under
a more traditional approach to work scheduling. In order to motivate employees
to accept and maintain this kind of schedule, the firm pays them a compensation
premium and provides them with 16 days of paid vacation and an airline ticket
to any major destination in the world after every 120-day work period.
Other work settings that are conducive to this kind of extended work schedule include offshore petroleum-drilling platforms, transoceanic cargo ships,
research labs in distant settings such as the South Pole,
and movie crews filming in remote locations .
While the specific number of hours and days and
the amount of vacation time vary, most of these
job settings are characterized by long periods of
work followed by an extended vacation plus pre mium pay. Offshore drilling platform workers at
ExxonMobil, for instance, generally work every day
for five weeks and then have two weeks off.
Some organizations find it useful to use extended work hours-work schedules with relatively long periods of work followed by
relatively long periods of paid time off. Firms that operate offshore drilling platforms like this one, for example, shuttle workers
back-and-forth between the work site and shore by helicopter.
Workers on the platform may work ten or even twelve hours
a day, everyday, for several weeks straight. They then get an
extended period of vacation time.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
220
PART 2 | Individual Behaviors and Processes in Organizations
Flexible Work Schedules
flexible work schedules
(or flextime)
Give employees more
personal control over the
hours they work each day
Another popular alternative work arrangement is flexible work
­s chedules, sometimes called flextime. The compressed work schedules
previously discussed give employees time off during “normal” working
hours, but they must still follow a regular and defined schedule on the days
when they do work. Flextime, however, usually gives employees less say
about what days they work but more personal control over the times when
they work on those days.23
Figure 6.3 illustrates how flextime works . The workday is broken down
into two categories: flexible time and core time. All employees must be at their
workstations during core time, but they can choose their own schedules during flexible time. Thus, one employee may choose to start work early in the
morning and finish by mid-afternoon, another to start in the late morning and
work until late afternoon, and a third to start early in the morning, take a long
lunch break, and work until late afternoon.
The major advantage of this approach, as already noted, is that workers
get to tailor their workda y to fit their personal needs . A person who needs
to visit the dentist in the late afternoon can just start work early. A person
who stays out late one night can start work late the next da y. And the person
who needs to run some errands during lunch can take a longer midday break.
On the other hand, flextime is more difficult to manage because others in the
organization may not be sure when a person will be available for meetings
other than during the core time. Expenses such as utilities will also be higher
since the organization must remain open for a longer period each day.
Some organizations use a plan in which workers set their own hours but
then must follow that schedule each day. Others allow workers to modify their
own schedule each day. Organizations that have used the flexible work schedule method for arranging work include Sun Microsystems, KPMG, Best Buy,
Pricewaterhouse Coopers, and some offices in the U.S. government. One survey found that as many as 43 percent of U.S. workers have the option to modify their work schedules; most of those who choose to do so start earlier than
normal so as to get off work earlier in the da y.24 A more recent study found
Figure 6.3
Flexible work schedules
are an important new
work arrangement used
in some organizations
today. All employees must
be at work during “core
time.” In the hypothetical
example shown here,
core time is from 9 to
11 a.m. and 1 to 3 p.m.
The other time, then,
is flexible—employees
can come and go as
they please during this
time, as long as the
total time spent at work
meets organizational
expectations.
Flexible Work Schedules
6:00 A.M.
Flexible
Time
1:00 P.M. – 3:00 P.M.
9:00 A.M. – 11:00 A.M.
Core
Time
Flexible
Time
Core
Time
6:00 P.M.
Flexible
Time
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 6 | Motivating Behavior with Work and Rewards
221
Alternative Workplaces
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that approximately 27 million full-time workers in
the United States have some degree of flexibility
in when they begin and end their work days.25
ES/
Many employers today offer flexible work schedules and the
freedom for employees to work at alternative work locations.
This individual, for example, is working from his home
office. Of course, not all jobs are amenable to these
arrangements, and even for those that are employees are
still expected to meet all of the responsibilities of their jobs.
Another recent innovation in work arrangements
is the use of alternative workplaces. The most common version of this approac h is usually called
­telecommuting—allowing employees to spend part of
their time working off-site, usually at home. By using
e-mail, web interfaces, and other tec hnology, many employees can maintain
close contact with their organization and do as muc h work at home as they
could in their offices. The increased power and sophistication of modern com munication technology—laptops and smartphones, among others—is making
telecommuting easier and easier.26 (Other terms used to describe this concept
are e-commuting and working from home.)
On the plus side, many employees like telecommuting because it gives them
added flexibility. By spending one or two days a week at home, for instance, they
have the same kind of flexibility to manage personal activities as is afforded by
flextime or compressed schedules. Some employees also feel that they get more
work done by staying at home because they are less likely to be interrupted.
Organizations may benefit for several reasons as well:(1) they can reduce absenteeism and turnover since employees will need to take less “formal” time off, and
(2) they can save on facilities such as parking spaces because fewer people will
be at work on any given day. There are also environmental benefits, given that
fewer cars are on the highways. On the other hand, although many employees
thrive under this arrangement, others do not. Some feel isolated and miss the
social interaction of the workplace. Others simply lack the self-control and discipline to walk away from the breakfast table to their desk and start working .
Managers may also encounter coordination difficulties in scheduling meetings
and other activities that require face-to-face contact.
telecommuting
Work arrangement in
which employees spend
part of their time working
off-site
GOAL SETTING AND MOTIVATION
Goal s etting i s a nother v ery u seful m ethod o f e nhancing e mployee
­p erformance. 27 From a motivational perspective , a goal is a meaningful
­objective. Goals are used for two purposes in most organizations . First, they
provide a useful framework for managing motivation. Managers and employees can set goals for themselves and then work tow ard them. Thus, if the
­organization’s overall goal is to increase sales by 10 percent, a manager can
goal
A meaningful objective
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
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PART 2 | Individual Behaviors and Processes in Organizations
use individual goals to help attain that organizational goal. Second, goals are
an effective control device ( control meaning the monitoring by management
of how well the organization is performing). Comparing people’s short-term
performances with their goals can be an effective way to monitor the organization’s longer-term performance.
Social learning theory perhaps best describes the role and importance
of goal setting in organizations.28 This perspective suggests that feelings of
pride or shame about performance are a function of the extent to which people
achieve their goals. A person who achieves a goal will be proud of having done
so, whereas a person who fails to achieve a goal will feel personal disappointment and perhaps even shame. People’s degree of pride or disappointment is
affected by their self-efficacy, the extent to which they feel that they can still
meet their goals even if they failed to do so in the past.
Goal-Setting Theory
Social learning theory provides insights into why and how goals can motivate
behavior. It also helps us understand how different people cope with failure to
reach their goals. The research of Edwin Locke and his associates most clearly
established the utility of goal-setting theory in a motivational context. 29
Locke’s goal-setting theory of motivation assumes that beha vior is a result
of conscious goals and intentions. Therefore, by setting goals for people in the
organization, a manager should be able to influence their behavior. Given this
premise, the challenge is to develop a thorough understanding of the processes
by which people set their goals and then work to reac h them. In the original
version of goal-setting theory, two specific goal characteristics—goal difficulty
and goal specificity—were expected to shape performance.
Goal Difficulty
Goal difficulty is the extent to which a goal is challenging and requires effort.
If people work to achieve goals, it is reasonable to assume that they will work
harder to achieve more difficult goals. But a goal must not be so difficult that
it is unattainable. If a new manager asks her sales force to increase sales by
300 percent, the group ma y ridicule her c harge
as laughable because they regard it as impossible
to reach. A more realistic but still difficult goal— ­
perhaps a 20 percent increase in sales—would
probably be a better objective.
A substantial body of researc h supports the
importance of goal difficulty.30 In one study, managers at Weyerhaeuser set difficult goals for truck
drivers hauling loads of timber from cutting sites
to wood yards. Over a nine-month period, the drivers increased the quantity of wood they delivered
by an amount that would have required $250,000
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goal difficulty
The extent to which a
goal is challenging and
requires effort
Goal setting can be a very useful method for motivating employees.
This is especially true if the employee gets to help set goals and is
rewarded for achieving them. This manager and her subordinate are
reviewing the subordinate’s goals for the next quarter.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 6 | Motivating Behavior with Work and Rewards
223
worth of new trucks at the previous per-truck average load.31 Reinforcement
also fosters motivation toward difficult goals. A person who is rew arded for
achieving a difficult goal will be more inclined to strive toward the next difficult goal than will someone who received no reward for reaching the first goal.
Goal Specificity
Goal specificity is the clarity and precision of the goal. A goal of “increasing productivity” is not very specific, whereas a goal of “increasing productivity by 3 percent in the next six months” is quite specific. Some goals, such as
those involving costs, output, profitability, and growth, can easily be stated in
clear and precise terms. Other goals, such as improving employee job satisfaction and morale, company image and reputation, ethical behavior, and social
responsibility, are much harder to state in specific or measurable terms.
Like difficulty, specificity has been shown to be consistently related to performance. The study of timber truck drivers previously mentioned also examined goal specificity. The initial loads the truck drivers were carrying were
found to be 60 percent of the maximum weight eac h truck could haul. The
managers set a new goal for drivers of 94 percent, which the drivers were soon
able to reach. Thus, the goal was quite specific as well as difficult.
Locke’s theory attracted widespread interest and research support from
both researchers and managers, so Locke, together with Gary Latham, eventually proposed an expanded model of the goal-setting process. The expanded
model, shown in Figure 6.4, attempts to capture more fully the complexities of
goal setting in organizations. The expanded theory argues that goal-directed
effort is a function of four goal attributes: difficulty and specificity ­(previously
discussed), and acceptance and commitment. Goal acceptance is the extent
to which a person accepts a goal as his or her own. Goal commitment is
the extent to whic h he or she is personally interested in reac hing the goal.
The manager who vows to take whatever steps are necessary to cut costs by
goal specificity
The clarity and precision
of a goal
goal acceptance
The extent to which a
person accepts a goal as
his or her own
goal commitment
The extent to which a
person is personally
interested in reaching a
goal
Figure 6.4
The Goal-Setting Theory of Motivation
Goal
Difficulty
Goal
Specificity
Goal
Acceptance
Organizational
Support
Goal-Directed
Effort
Performance
Goal
Commitment
Individual
Abilities and Traits
Intrinsic
Rewards
Satisfaction
The goal-setting theory
of motivation provides
an important means
of enhancing the
motivation of employees.
As illustrated here,
appropriate goal
difficulty, specificity,
acceptance, and
commitment contribute to
goal-directed effort. This
effort, in turn, has a direct
impact on performance.
Extrinsic
Rewards
Source: Reprinted from Latham, G. P., et al. (1979, Autumn). The Goal-Setting Theory of Motivation. Organizational
­Dynamics. Copyright 1979, with permission from Elsevier.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
224
PART 2 | Individual Behaviors and Processes in Organizations
10 percent has made a commitment to ac hieving the goal. Factors that can
foster goal acceptance and commitment include participating in the goal-­
setting ­process, making goals challenging but realistic, and believing that goal
achievement will lead to valued rewards.32
The interaction of goal-directed effort, organizational support, and individual abilities and traits determines actual performance. Organizational
support is whatever the organization does to help or hinder performance. Positive support might mean providing whatever resources are needed to meet
the goal; negative support might mean failing to provide such resources, perhaps due to cost considerations or staff reductions . Individual abilities and
traits are the skills and other personal c haracteristics necessary to do a job.
As a result of performance, a person receives various intrinsic and extrinsic
rewards that in turn influence satisfaction. Note that the latter stages of this
model are quite similar to those of the P orter and Lawler expectancy model
discussed in Chapter 5.
Broader Perspectives on Goal Setting
management by
objectives (MBO)
A collaborative goalsetting process through
which organizational
goals cascade
down throughout the
organization
Some organizations undertake goal setting from the somewhat broader perspective of management by objectives, o r MBO. The MBO approac h is
essentially a collaborative goal-setting process through which organizational
goals systematically cascade down through the organization. Our discussion
describes a generic approach, but many organizations adapt MBO to suit their
own purposes and use a variety of names for it. (Indeed, most firms today use
other names. However, since no other generic label has emerged, we will continue to refer to this approach as MBO.)
A successful MBO program starts with top managers’ establishing overall
goals for the organization. After these goals have been set, managers and employees throughout the organization collaborate to set subsidiary goals . First, the
overall goals are communicated to everyone. Then each manager meets with each
subordinate. During these meetings, the manager explains the unit goals to the
subordinate, and the two together determine how the subordinate can contribute
to the goals most effectively. The manager acts as a counselor and helps ensure
that the subordinate develops goals that are verifiable . For example, a goal of
“cutting costs by 5 percent” is verifiable, whereas a goal of “doing my best” is not.
Finally, manager and subordinate ensure that the subordinate has the resources
needed to reach his or her goals. The entire process flows downward as each subordinate manager meets with his or her own subordinates to develop their goals .
Thus, as we noted earlier, the initial goals set at the top cascade down through the
entire organization.
During the time frame set for goal attainment (usually one year), the
manager periodically meets with each subordinate to check progress. It may
be necessary to modify goals in light of new information, to provide addi tional resources, or to take some other action. At the end of the specified time
period, managers hold a final evaluation meeting with eac h subordinate. At
this meeting, manager and subordinate assess how well goals were met and
discuss why. This meeting often serves as the annual performance review as
well, determining salary adjustments and other rewards based on reaching
goals. This meeting may also serve as the initial goal-setting meeting for the
next year’s cycle.
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CHAPTER 6 | Motivating Behavior with Work and Rewards
Goal Setting Challenges
Goal-setting theory has been widely tested in a variety of settings . Research has
demonstrated fairly consistently that goal difficulty and specificity are c losely
associated with performance. Other elements of the theory, such as acceptance
and commitment, have been studied less frequently. A few studies have shown the
importance of acceptance and commitment, but little is currently known about
how people accept and become committed to goals. Goal-setting theory may also
focus too much attention on the short run at the expense of long-term consider ations. Despite these questions, however, goal setting is clearly an important way
for managers to convert motivation into actual improved performance.
From the broader perspective , MBO remains a very popular tec hnique.
Alcoa, Tenneco, General Foods, and DuPont, for example, have used versions of
MBO with widespread success. The technique’s popularity stems in part from
its many strengths. For one thing, MBO clearly has the potential to motivate
employees because it helps implement goal-setting theory on a systematic basis
throughout the organization. It also clarifies the basis for rewards, and it can
stimulate communication. Performance appraisals are easier and more c learcut under MBO. Further, managers can use the system for control purposes.
However, using MBO also presents pitfalls, especially if a firm takes too
many shortcuts or inadvertently undermines how the process is supposed to
work. Sometimes, for instance, top managers do not really participate; that is,
the goals are actually established in the middle of the organization and may
not reflect the real goals of top management. If employees believe this situation to be true, they may become cynical, interpreting the lack of participation
by top management as a sign that the goals are not important and that their
own involvement is therefore a waste of time. MBO also has a tendency to
overemphasize quantitative goals to enhance verifiability. Another potential
liability is that an MBO system requires a great deal of information process ing and record keeping since every goal must be documented. Finally, some
managers do not really let subordinates participate in goal setting but instead
merely assign goals and order subordinates to accept them.
On balance, MBO is often an effective and useful system for managing
goal setting and enhancing performance in organizations. Research suggests
that it can actually do many of the things its advocates c laim but that it must
also be handled carefully. In particular, most organizations need to tailor it to
their own unique circumstances. Properly used, MBO can also be an effective
approach to managing an organization’s reward system. It does require, however, individual, one-on-one interactions between eac h supervisor and each
employee; and these one-on-one interactions can often be difficult because of
the time they take and the likelihood that at least some of them will involve
critical assessments of unacceptable performance.
PERFORMANCE MANAGEMENT
As described earlier, most goals are oriented tow ard some element of performance. Managers can do a variety of things to enhance employee motivation
and performance, including designing jobs, allowing greater participation and
promoting empowerment, considering alternative work arrangements, and setting goals. However, they may also fail to do things that might have improved
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225
226
PART 2 | Individual Behaviors and Processes in Organizations
performance appraisal
The process of assessing
and evaluating
an employee’s
work behaviors by
measurement
motivation and performance, and they might even inadvertently do things that
reduce motivation and performance. Thus, it is clearly important that managers
understand that performance is something that can and should be managed.33
Moreover, effective performance management is essential in order for rewards to
be used effectively. The core of performance management is the actual measurement of the performance of an individual or group. Performance appraisal
is the process by whic h someone (1) evaluates an employee’ s work behaviors
by measurement and comparison with previously established standards , (2)
documents the results, and (3) communicates the results to the employee.34 Performance management comprises the processes and activities involved in per formance appraisals.
Purposes of Performance Measurement
Performance appraisal may serve many purposes. The ability to provide valuable feedback is one critical purpose . Feedback, in turn, tells the employee
where she or he stands in the eyes of the organization. Appraisal results, of
course, are also used to decide and justify reward allocations. Performance
evaluations may be used as a starting point for discussions of training , development, and improvement. Finally, the data produced by the performance
appraisal system can be used to forecast future human resource needs, to plan
management succession, and to guide other human resource activities such as
recruiting, training, and development programs.
Providing job performance feedback is the primary use of appraisal information. Performance appraisal information can indicate that an employee is ready
for promotion or that he or she needs additional training to gain experience in
another area of company operations. It may also show that a person does not
have the skills for a certain job and that another person should be recruited to
fill that particular role. Other purposes of performance appraisal can be grouped
into two broad categories, judgment and development, as shown in Figure 6.5.
Figure 6.5
Performance
measurement plays a
variety of roles in most
organizations. This figure
illustrates that these
roles can help managers
judge an employee’s
past performance and
help managers and
employees improve future
performance.
Purposes of Performance Management
Basic Purpose of Performance Measurement:
Provide Information About Work Performance
Judgment of
Past Performance
Development of
Future Performance
Provide a basis for reward
allocation
Provide a basis for promotions,
transfers, layoffs, and so on
Identify high-potential
employees
Validate selection procedures
Evaluate previous training
programs
Foster work improvement
Identify training and
development opportunities
Develop ways to overcome
obstacles and performance
barriers
Establish supervisor–employee
agreement on expectations
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CHAPTER 6 | Motivating Behavior with Work and Rewards
227
Performance appraisals with a judgmental orientation focus on past
performance and are concerned mainly with measuring and comparing per formance and with the uses of this information. Appraisals with a develop mental orientation focus on the future and use information from evaluations
to improve performance. If improved future performance is the intent of the
appraisal process, the manager may focus on goals or targets for the employee,
on eliminating obstacles or problems that hinder performance, and on future
training needs.
Elements of Performance Management
Employee appraisals are common in every type of organization, but how they
are performed may vary. Many issues must be considered in determining how
to conduct an appraisal. Three of the most important issues are who does the
appraisals, how often they are done, and how performance is measured.
The Appraiser
In most appraisal systems, the employee’s primary evaluator is the supervi sor. This stems from the obvious fact that the supervisor is presumably in the
best position to be aware of the employee’s day-to-day performance. Further,
it is the supervisor who has traditionally provided performance feedbac k to
employees and determined performance-based rewards and sanctions. Problems often arise, however, if the supervisor has incomplete or distorted information about the employee’s performance. For example, the supervisor may
have little firsthand knowledge of the performance of an employee who works
alone outside the company premises, such as a salesperson making solo calls
on clients or a maintenance person handling equipment problems in the field.
Similar problems may arise when the supervisor has a limited understanding of the technical knowledge involved in an employee’s job. Our Understand Yourself feature will give you insight into your own style for providing
feedback.
One solution to these problems is a multiple-rater system that incorpo rates the ratings of several people familiar with the employee’ s performance.
One possible alternative, for example, is to use the employee as an evaluator.
Although they may not actually do so, most employees are actually very capable of evaluating themselves in an unbiased manner. One of the more interesting multi-rater approaches being used in some companies today is something
called 360-degree feedback (it is also called multi-source feedback). This
method involves employees receiving performance feedback from those on all
“sides” of them in the organization—their boss, their colleagues and peers, and
their own subordinates. Thus, the feedback comes from all around them, or
from 360 degrees. This form of performance evaluation can be very beneficial
to managers because it typically gives them a muc h wider range of perfor mance-related feedback than a traditional evaluation provides. That is, rather
than focusing narrowly on objective performance , such as sales increases or
productivity gains, 360-degree feedback often focuses on such things as interpersonal relations and style . For example, one person ma y learn that she
stands too close to other people when she talks, another that he has a bad
temper. These are the kinds of things a supervisor might not even be a ware
of, much less report as part of a performance appraisal. Subordinates or peers
360-degree feedback
A performance appraisal
method in which
employees receive
performance feedback
from those on all sides of
them in the organization
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TUULIJUMALA/SHUTTERSTOCK.COM
228
PART 2 | Individual Behaviors and Processes in Organizations
U N D E R S TA N D Y O U R S E L F
YOUR FEEDBACK STYLE
This exercise will help you understand the dynamics of performance appraisal feedback. Diagnosing performance is
critical to effective management. Performance appraisal
involves both diagnosis and motivation and so is critical to
the effective functioning of organizations. One of the difficulties with most performance appraisal systems is that the
supervisor or manager feels uncomfortable providing feedback in a one-to-one encounter. The result often is employee
vagueness about what the performance appraisal really
means, what it is designed to do, and how it can improve
performance. The supervisor or manager fails to address
those concerns because he or she did not adequately diagnose the situation and therefore lacks an understanding of
how subordinates respond to performance feedback or
lacks the skill necessary to provide valuable feedback. Listed
below is a set of feedback behaviors. Read the description
of each behavior carefully, then select the response that best
reflects the extent to which that behavior describes what you
do or think you would do. Indicate your choice by circling
the response. The possible responses are as follows:
Possible Responses
Y = Yes, this definitely describes me.
Y = Yes I’m fairly sure this describes me.
? = I’m not sure.
N = No, I’m fairly sure this doesn’t describe me.
N = No, this definitely doesn’t describe me.
1. When communicating, I try to seek feedback from the
receiver to determine whether I’m being understood.
1. Y 2. Y 3. ? 4. N 5. N
2. Whenever possible, I try to ensure that my point of
view is accepted and acted upon.
1. Y 2. Y 3. ? 4. N 5. N
3. I can easily handle and accept counterarguments to
my ideas.
1. Y 2. Y 3. ? 4. N 5. N
4. When a communication problem occurs between
another person and myself, it’s usually his or her fault.
1. Y 2. Y 3. ? 4. N 5. N
5. I make sure the other person understands that I know
what I am talking about.
1. Y 2. Y 3. ? 4. N 5. N
6. If someone comes to me with a personal problem, I
try to listen objectively without being judgmental.
1. Y 2. Y 3. ? 4. N 5. N
7. When listening to someone questioning or criticizing
my procedures, I often find myself engaging in mental counterarguments—thinking about my response
while the person is talking.
1. Y 2. Y 3. ? 4. N 5. N
8. I let the other person finish an idea before intervening or finishing it for him or her.
1. Y 2. Y 3. ? 4. N 5. N
9. When listening to someone, I find that I can
easily restate (paraphrase) that person’s point of
view.
1. Y 2. Y 3. ? 4. N 5. N
10. I try not to prejudge the speaker or the message.
1. Y 2. Y 3. ? 4. N 5. N
11. Whenever I provide information to someone, I prefer
using facts and data.
1. Y 2. Y 3. ? 4. N 5. N
12. C ommunicating empathy for the feelings of the
receiver tends to indicate weakness.
1. Y 2. Y 3. ? 4. N 5. N
13. I try to ensure that others know how I view their
actions: good, bad, strong, weak, etc.
1. Y 2. Y 3. ? 4. N 5. N
14. In order to get people to do things properly, you have
to tell them what to do.
1. Y 2. Y 3. ? 4. N 5. N
15. When talking with someone, I like saying, “What
do you think?” to introduce more acceptance of the
issue.
1. Y 2. Y 3. ? 4. N 5. N
16. If you are the boss, people expect you to tell them
what to do.
1. Y 2. Y 3. ? 4. N 5. N
17. I try to use probing, nondirective questions in discussions with individuals.
1. Y 2. Y 3. ? 4. N 5. N
18. In providing negative feedback, I want to be certain
the receiver knows how I view the situation.
1. Y 2. Y 3. ? 4. N 5. N
19. I try to listen with empathy. I listen both to what is
being said and to what I think the sender is trying to
say.
1. Y 2. Y 3. ? 4. N 5. N
20. W henever I provide someone with feedback,
I usually want to persuade him or her to act on it.
1. Y 2. Y 3. ? 4. N 5. N
(Continued)
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CHAPTER 6 | Motivating Behavior with Work and Rewards
229
Scoring:
(1) For the items listed, score your responses as follows: (2) For the items listed, the scoring system is reversed:
Item Score
1. ____
3. ____
6. ____
8. ____
9. ____
10. ____
11. ____
15. ____
17. ____
19. ____
TOTAL ____
Scoring
Y=2
Y=1
?=0
N = −1
N = −2
Item Score
2. ____
4. ____
5. ____
7. ____
12. ____
13. ____
14. ____
16. ____
18. ____
20. ____
TOTAL ____
Scoring
Y = −2
Y = −1
?=0
N=1
N=2
The items on the left assess if you are collaborative and open. The items on the right assess if you are domineering and closed
in style. Stating “yes” to these items indicates a less effective feedback style so it is reverse scored (Y = −2, N = 2). A higher
score on either column thus indicates a more effective style. The sum of your two scores indicates your overall feedback style.
The lowest overall score is −40 and the highest overall score is +40. Most people will score in the positive range.
are much more willing to provide this sort of feedback than direct performance
feedback, especially if it is used for development purposes and does not influ ence rewards or punishments. AT&T, Nestlé, Pitney Bowes, and JPMorgan
Chase are a few of the major companies toda y using 360-degree feedback to
help managers improve a wide variety of performance-related behaviors.35
Frequency of the Appraisal
Another important issue is the frequency of appraisals . Regardless of the
employee’s level of performance, the types of tasks being performed, or the
employee’s need for information on performance, the organization usually conducts performance appraisals on a regular basis, typically once a year. Annual
performance appraisals are convenient for administrative purposes suc h as
record keeping and maintaining a level of routine that helps keep everyone
comfortable. Some organizations also conduct appraisals semiannually. 36 Several systems for monitoring employee performance on an “as-needed” basis
have been proposed as an alternative to the traditional annual system.
Managers in international settings must ensure that they incorporate cultural phenomena into their performance-appraisal strategies . For example,
in highly individualistic cultures such as that of the United States, appraising performance at the individual level is both common and accepted. But in
collectivistic cultures such as Japan, performance appraisals almost always
need to be focused more on group performance and feedback. And in countries
where people put a lot of faith in destiny, fate, or some form of divine control,
employees may not be receptive to performance feedback at all, believing that
their actions are irrelevant to the results that follow them.
Measuring Performance
The foundation of good performance management is correctly identifying what
should be measured and the selection of the best method(s) for measuring it.
Accurately defining job performance is critical: measuring the wrong things
well is not good performance management. Once the critical performance
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230
PART 2 | Individual Behaviors and Processes in Organizations
Key elements of performance management
are measuring and assessing performance.
Performance rating scales such as this one are
commonly used for assessing performance in
organizations.
RAGMA
IMAGES
/SHUTT
ERSTOC
K.COM
dimensions are known, the best way(s)
of assessing them can be identified.
Detailed descriptions of the many dif ferent methods for measuring performance are beyond the scope of this book;
they are more appropriately covered in a
course in human resource management
or a specialized course in performance
appraisal. However, we can present a few
general comments about how to measure
performance.
The measurement method provides the
information managers use to make decisions
about salary adjustment, promotion, transfer, training, and discipline. The courts and
Equal Employment Opportunity guidelines
have mandated that performance measurements be based on job-related criteria
rather than on some other factor such as friendship, age, sex, religion, or national
origin. In addition, to provide useful information for the decision maker, performance appraisals must be valid, reliable, and free of bias. They must not produce
ratings that are consistently too lenient or too severe or that all c luster in the
middle.37 They must also be free of perceptual and timing errors.
Some of the most popular methods for evaluating individual performance
are graphic rating scales, checklists, essays or diaries, behaviorally anchored
rating scales, and forced choice systems. These systems are easy to use and
familiar to most managers. However, two major problems are common to all
individual methods: a tendency to rate most individuals at about the same
level, and the inability to discriminate among variable levels of performance.
Comparative methods evaluate two or more employees by comparing them
with each other on various performance dimensions. The most popular comparative methods are ranking, forced distribution, paired comparisons, and
the use of multiple raters in making comparisons. Comparative methods, however, are more difficult to use than the individual methods, are unfamiliar to
many managers, and may require sophisticated development procedures and
a computerized analytical system to extract usable information.
balanced scorecard or
BSC
A relatively structured
performance
management technique
that identifies financial
and nonfinancial
performance measures
and organizes them into
a single model
The Balanced Scorecard Approach to
Performance Management
A relatively new and increasingly popular form of performance manage ment system is the balanced scorecard approach. The balanced scorecard,
or BSC, is a structured performance management technique that identifies
financial and nonfinancial performance measures and organizes them into a
single model.38 The basic BCS is shown in Figure 6.6.
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CHAPTER 6 | Motivating Behavior with Work and Rewards
231
Figure 6.6
The Balanced Scorecard
Finance
–Goal
–Measure
Customer
–Goal
–Measure
Vision
and
Strategy
Internal Business
Processes
–Goal
–Measure
The balanced
scorecard is a
structured performance
management technique.
In its most basic form,
managers establish both
goals and measures for
how they want to assess
customer perceptions,
financial performance,
internal business
process, and innovation
and learning. Each of
these sets of goals and
measures need to be
consistent with each
other as well as with the
organization’s overall
vision and strategy.
Innovation and
Learning
–Goal
–Measure
At the core of the BSC is organizational vision and strategy. These must
be clearly established and communicated throughout the organization by the
top management team. Next, managers establish a small number of objective
goals and measures to support four key components of organizational success.
These components are customer perceptions, financial performance, internal
business processes, and innovation and learning. All subsequent performance
measures are derived from this framework.
For instance, suppose that top managers ha ve determined that they w ant
customers to see the firm as a preferred provider of high-quality, premium-priced
fashion watches (for example, Rolex). Goals and measures to support this component might be to maintain a 50 percent market share and 98 percent customer
satisfaction index within the chosen market segment. One major area of individual performance evaluation, then, would focus on the extent to which a person is
contributing market share, customer satisfaction, and/or a closely related area.
Not surprisingly, there are now a number of commercially a vailable business software systems that help support the balanced scorecard approac h.
Moreover, a wide array of businesses report using the original BSC, a newer
revised version of the BSC, or an alternative model that is patterned after the
BSC. On the other hand, most of the evidence used to support the validity of
the BSC is anecdotal in nature. That is, its value as a performance manage ment system has not been demonstrated in a rigorous and empirical manner.
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232
PART 2 | Individual Behaviors and Processes in Organizations
INDIVIDUAL REWARDS IN
ORGANIZATIONS
reward system
All organizational
components, including
people, processes, rules
and procedures, and
decision-making activities,
involved in allocating
compensation and
benefits to employees
in exchange for their
contributions to the
organization
As noted earlier, one of the primary purposes of performance management is
to provide a basis for rew arding employees. In addition, rewards are among
the most powerful things managers can use to motivate beha vior. The reward
system consists of all organizational components—including people, processes,
rules and procedures, and decision-making activities—involved in allocating
compensation and benefits to employees in exchange for their contributions to
the organization.39 As we examine organizational reward systems, it is important to keep in mind their role in psychological contracts (as discussed in Chapter 2 and employee motivation (as discussed in Chapter 5). Rewards constitute
many of the inducements that organizations provide to employees as their part
of the psychological contract, for example. Rewards also satisfy some of the needs
employees attempt to meet through their choice of work-related behaviors.
Roles, Purposes, and Meanings of Rewards
surface value
Objective meaning or
worth of a reward
The purpose of the reward system in most organizations is to attract, retain,
and motivate qualified employees . The organization’s compensation struc ture must be equitable and consistent to ensure equality of treatment and
compliance with the law. Compensation should also be a fair rew ard for the
individual’s contributions to the organization, although in most cases these
contributions are difficult, if not impossible, to measure objectively. Given this
limitation, managers should be as fair and as equitable as possible . Finally,
the system must be competitive in the external labor market for the organization to attract and retain competent workers in appropriate fields.40
Beyond these broad considerations, an organization must develop its philosophy of compensation based on its own conditions and needs , and this philosophy must be defined and built into the actual reward system. For example,
Walmart has a policy that none of its employees will be paid the minimum
wage. Even though it may pay some people only slightly more than this mini mum, the firm nevertheless wants to communicate to all workers that it places
a higher value on their contributions than just ha ving to pay them the lowest
wage possible.
The organization needs to decide what types of beha viors or performance
it wants to encourage with a reward system because what is rewarded tends
to recur. Possible behaviors include performance, longevity, attendance, loyalty,
contributions to the “bottom line,” responsibility, and conformity. Performance
measurement, as described earlier, assesses these behaviors, but the choice of
which behaviors to reward is a function of the compensation system. A reward
system must also take into account volatile economic issues suc h as inflation,
market conditions, technology, labor union activities, and so forth.
It is also important for the organization to recognize that organizational
rewards have many meanings for employees. Intrinsic and extrinsic rewards
carry both surface and symbolic value . The surface value of a rew ard to
an employee is its objective meaning or worth. A salary increase of 5 per cent, for example, means that an individual has 5 percent more spending
power than before, whereas a promotion, on the surface, means new duties
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CHAPTER 6 | Motivating Behavior with Work and Rewards
LOSKUTNIKOV/SHUTTERSTOCK.COM
and responsibilities. But managers must recognize that rew ards also carry
­symbolic value. If a person gets a 3 percent salary increase when everyone
else gets 5 percent, one plausible meaning is that the organization values
other employees more. But if the same person gets 3 percent and all others get
only 1 percent, the meaning may be just the opposite—the individual is seen
as the most valuable employee. Thus, rewards convey to people not only how
much they are valued by the organization but also their importance relative to
others. Managers need to tune in to the many meanings rewards can convey—
not only the surface messages but the symbolic messages as well.
CASE STUDY
233
symbolic value
Subjective and personal
meaning or worth of a
reward
The Whole Truth
Whole Foods Market (WFM) started out in 1980
as one store with 19 employees in Austin, Texas.
Today, with 370 stores and 54,000 employees in
North America and Great Britain, it’s the leading
natural and organic foods supermarket (and ninthlargest food and drug chain in the United States).
Along the way, it has also gained a considerable
reputation as a socially responsible company and
a good place to work. WFM’s motto is “Whole
Foods, Whole People, Whole Planet,” and its
guiding “core value,” according to co-CEO Walter Robb, is “customers first, then team members,
balanced with what’s good for other stakeholders…. If I put our mission in simple terms,” Robb
continues, “it would be, No. 1, to change the way
the world eats and, No. 2, to create a workplace
based on love and respect.”
WFM made Fortune magazine’s very first list
of the “100 Best Companies to Work For” in
1998 and has routinely appeared on the list ever
since. Observers have acknowledged the company’s growth (which means more jobs), salary-cap
limits (the top earner gets no more than 19 times
the average full-time salary), and generous health
plan. The structure of the company’s current health
care program, which revolves around high
deductibles and so-called health savings accounts
(HSAs), was first proposed in 2003. Under such a
plan, an employee (a “team member,” in WFM
parlance) pays a deductible before his or her
expenses are covered.
Meanwhile, the employer funds a special
account (an HSA) for each employee, who can
spend the money to cover health-related expenditures. The previous WFM plan had covered 100
percent of all expenses, and when some employees
complained about the proposed change, the company decided to put it to a vote. Nearly 90 percent
of the workforce went to the polls, with 77 percent
voting for the new plan. In 2006, employees voted
to retain the plan, which now carries a deductible of
around $1,300; HSAs may go as high as $1,800
(and accrue for future use). The company pays 100
percent of the premiums for eligible employees
(about 89 percent of the workforce).
High-deductible plans save money for the
employer (the higher the deductible, the lower the
premium), and more importantly—at least according to founder and co-CEO John Mackey—they also
make employees more responsible consumers.
When the first $1,300 of their medical expenses
comes out of their own pockets (or their own
HSAs), he argues, people “start asking how much
things cost. Or they get a bill and say, ‘Wow,
that’s expensive.’ They begin to ask questions.
They may not want to go to the emergency room if
they wake up with a hangnail in the middle of the
night. They may schedule an appointment now.”41
Questions
1. How important would benefits like those
offered by Whole Foods be to you if you
were working there to put yourself through
school or to collect a paycheck while looking for a position in your chosen field?
2. What negative elements do you see in
Whole Foods approach to pay and benefits?
3. Why don’t more companies use the
approach to employee health care pioneered by Whole Foods?
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
PHANT/SHUTTERSTOCK.COM
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PART 2 | Individual Behaviors and Processes in Organizations
Types of Rewards
compensation package
The total array of
money (wages, salary,
commissions), incentives,
benefits, perquisites,
and awards provided by
the organization to an
individual
incentive systems
Plans in which employees
can earn additional
compensation in return
for certain types of
performance
Most organizations use several different types of rewards. The most common
are base pay (wages or salary), incentive systems, benefits, perquisites, and
awards. These rewards are combined to create an individual’s compensation
package.
Base Pay
For most people, the most important reward for work is the pay they receive.
Obviously, money is important because of the things it can buy, but as we just
noted, it can also symbolize an employee’s worth. Pay is very important to an
organization for a variety of reasons. For one thing, an effectively planned and
managed pay system can improve motivation and performance. For another,
employee compensation is a major cost of doing business—well over 50 per cent in many organizations—so a poorly designed system can be an expensive
proposition. Finally, since pay is considered a major source of employee dissatisfaction, a poorly designed system can result in problems in other areas suc h
as turnover and low morale.
Incentive Systems
Incentive systems are plans in whic h employees can earn additional
­compensation in return for certain types of performance. Examples of ­incentive
programs include the following:
1. Piecework programs, which tie a worker’s earnings to the number of units
produced
2. Gain-sharing programs, which grant additional earnings to employees or
workgroups for cost-reduction ideas
3. Bonus systems, which provide managers with lump-sum payments from a
special fund based on the financial performance of the organization or a
unit
4. Long-term compensation, which gives managers additional income based
on stock price performance, earnings per share, or return on equity
5. Merit pay plans, which base pay raises on the employee’s performance
6. Profit-sharing plans, which distribute a portion of the firm’s profits to all
employees at a predetermined rate
7. Employee stock option plans , which set aside stoc k in the company for
employees to purchase at a reduced rate
Plans oriented mainly toward individual employees may cause increased
competition for the rewards and some possibly disruptive behaviors, such as
sabotaging a coworker’s performance, sacrificing quality for quantity, or fighting over customers. A group incentive plan, on the other hand, requires that
employees trust one another and work together. Of course, all incentive systems have advantages and disadvantages.
Long-term compensation for executives is particularly controversial
because of the large sums of money involved and the basis for the pa yments.
Indeed, executive compensation is one of the more controversial subjects that
U.S. businesses have had to face in recent years. News reports and the popular
press seem to take great joy in telling stories about how this or that executive
has just received a huge windfall from his or her organization. The job of a
senior executive, especially a CEO, is grueling and stressful and takes talent
and decades of hard work to reach. Clearly, successful top managers deserve
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 6 | Motivating Behavior with Work and Rewards
235
significant rewards. The question is whether some companies are overrewarding such managers for their contributions to the organization.42
When a firm is growing rapidly and its profits are also growing rapidly ,
relatively few objections can be raised to paying the CEO well. However, objections arise when an organization is laying off workers, its financial performance is perhaps less than might be expected, and the CEO is still earning
a huge amount of money. It is these situations that dictate that a company’s
board of directors take a c loser look at the appropriateness of its executive
compensation decisions.43
Indirect Compensation
Another major component of the compensation pac kage is indirect
­compensation, also commonly referred to as the employee benefits plan.
­Typical benefits provided by businesses include the following:
1. Payment for time not worked, both on and off the job . On-the-job free time
includes lunch, rest, coffee breaks, and wash-up or get-ready time. Off-the-job
time not worked includes vacation, sick leave, holidays, and personal days.
2. Social Security contributions. The employer contributes half the money
paid into the system established under the Federal Insurance Contributions Act (FICA). The employee pays the other half.
3. Unemployment compensation. People who have lost their jobs or are temporarily laid off get a percentage of their w ages from an insurance-like
program.
4. Disability and workers’ compensation benefits. Employers contribute funds
to help workers who cannot work due to occupational injury or ailment.
5. Life and health insurance programs. Most organizations offer insurance at
a cost far below what individuals would pay to buy insurance on their own.
6. Pension or retirement plans. Most organizations offer plans to provide supplementary income to employees after they retire.
indirect compensation
Employee benefits
provided as a form of
compensation
benefits
Rewards and incentives
provided to employees in
addition to their wages or
salaries
ERSTOC
K.COM
A company’s Social Security, unemployment, and workers’ unemploy ment compensation contributions are set by la w. But deciding how muc h to
contribute for other kinds of benefits is up to each company. Some
organizations contribute more to the cost of these
benefits than others. Some companies pa y
the entire cost; others pa y a percentage of
the cost of certain benefits , such as health
insurance, and bear the entire cost of other
benefits. Moreover, many technology companies today find it necessary to offer extravagant benefits to attract high-talent workers.
For example, Google provides its employees
with gourmet food, free massages, and a spa.
Facebook employees also get gourmet food, plus
/SHUTT
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One common form of indirect compensation is being paid
for time not worked. Vacation time is one frequent form of
paid time off. Of course, as shown here, in today’s business
world many people still check their email and communicate
with their colleagues even while on vacation.
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236
PART 2 | Individual Behaviors and Processes in Organizations
wash-and-fold laundry services, free haircuts, four weeks of paid vacation,
and 100 percent company-paid medical, dental, and vision insurance. Zynga
­provides on-site dog care, including free grooming service.44
perquisites
Special privileges
awarded to selected
members of an
organization, usually top
managers
Perquisites
Perquisites are special privileges awarded to selected members of an organization, usually top managers. For years, the top executives of many busi nesses were allowed privileges suc h as unlimited use of the company jet,
motor home, vacation home, and executive dining room. In Japan, a popular perquisite is a paid membership in an exclusive golf club; a common
­perquisite in England is first-class travel. In the United States, the Internal
Revenue Service has ruled that some “perks” constitute a form of income
and thus can be taxed. This decision has substantially changed the nature of
these benefits, but they have not entirely disappeared, nor are they likely to.
Today, however, many perks tend to be more job-related. For example, popular perks currently include a car and driver (so that the executive can presumably work while being transported to and from work) and membership
in airport clubs (so that the executive can more comfortably conduct busi ness while traveling). More than anything else, though, perquisites seem to
add to the status of their recipients and thus may increase job satisfaction
and reduce turnover.45
VOLT
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Awards
At many companies, employees receive awards for everything from seniority
to perfect attendance, from zero defects (quality work) to cost reduction sug gestions. Award programs can be costly in the time required to run them and
in money if cash awards are given, but award systems can improve performance under the right conditions. In one medium-size manufacturing company, careless work habits were pushing up the costs of scrap and rework
(the cost of scrapping defective parts or reworking them to meet standards).
Management instituted a zero-defects program to recognize employees who
did perfect or near-perfect work. During the first month, two workers in shipping caused only one defect in over two thousand parts handled. Division
management called a meeting in the lunchroom and recognized each worker
with a plaque and a ribbon. The next month,
the same two workers had two defects, so there
was no award. The following month, the two
workers had zero defects, and once again top
management ca lled a mee ting t o g ive o ut
plaques and ribbons. Elsewhere in the plant,
defects, scrap, and rework decreased dramatically as workers evidently sought recogni tion for quality work. What worked in this
particular plant ma y or ma y not work in
others.46
Awards and prizes are frequently used to reward
outstanding performance. This manager is getting an
award for achieving the most revenue growth in the
company.
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CHAPTER 6 | Motivating Behavior with Work and Rewards
Related Issues in Rewarding Performance
Much of our discussion on reward systems has focused on general issues. As
Table 6.1 shows, however, the organization must address other issues when
developing organizational reward systems. The organization must consider its
ability to pay employees at certain levels, economic and labor market condi tions, and the impact of the pa y system on organizational financial perfor mance. In addition, the organization must consider the relationship between
performance and rewards as well as the issues of rew ard system flexibility,
employee participation in the rew ard system, pay secrecy, and expatriate
compensation.
Linking Performance and Rewards
For managers to take full advantage of the symbolic value of pa y, there must
be a perception on the part of employees that their rewards are linked to their
performance. For example, if everyone in an organization starts working for
the same hourly rate and then receives a predetermined w age increase every
six months or year, there is clearly no relationship between performance and
rewards. Instead, the organization is indicating that all entry-level employees
are worth the same amount, and pay increases are tied solely to the length
of time an employee works in the organization. This holds true whether the
employee is a top , average, or mediocre employee . The only requirement is
that the employee works well enough to avoid being fired.
At the other extreme, an organization might attempt to tie all compensation to actual performance. Thus, each new employee might start at a different wage, as determined by his or her experience, education, skills, and other
Table 6.1
Issues to Consider in Developing Reward Systems
Issue
Important Examples
PAY SECRECY
• Open, closed, partial
• Link with performance appraisal
• Equity perceptions
EMPLOYEE PARTICIPATION
• By human resource department
• By joint employee/management committee
FLEXIBLE SYSTEM
• Cafeteria-style benefits
• Annual lump sum or monthly bonus
• Salary versus benefits
ABILITY TO PAY
• Organization’s financial performance
• Expected future earnings
ECONOMIC AND LABOR
• Inflation rate
MARKET FACTORS
• Industry pay standards
• Unemployment rate
IMPACT ON ORGANIZATIONAL PERFORMANCE
• Increase in costs
• Impact on performance
EXPATRIATE COMPENSATION
• Cost-of-living differentials
• Managing related equity issue
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237
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PART 2 | Individual Behaviors and Processes in Organizations
job-related factors. After joining the organization, the individual then receives
rewards based on actual performance. One employee, for example, might start
at $15 an hour because she has ten years of experience and a good perfor mance record at her previous employer. Another might start the same job at a
rate of $10.50 an hour because he has only four years’ experience and an ade quate but not outstanding performance record. Assuming the first employee
performs up to expectations, she might also get several pay increases, bonuses,
and awards throughout the year whereas the second employee might get only
one or two small increases and no other rew ards. Of course, organizations
must ensure that pay differences are based strictly on performance (including
seniority), and not on factors that do not relate to performance (suc h as gender, ethnicity, or other discriminatory factors).
In reality, most organizations attempt to develop a reward strategy somewhere between these two extremes. Because it is really quite difficult to dif ferentiate among all the employees, most firms use some basic compensation
level for everyone. For example, they might start everyone performing a spe cific job at the same rate , regardless of experience. They might also work to
provide reasonable incentives and other inducements for high performers
while making sure that they don’t ignore the a verage employees. The key fact
for managers to remember is simply that if they expect rewards to motivate
performance, employees must see a c lear, direct link between their own jobrelated behaviors and the attainment of those rewards.47
flexible reward system
Allows employees to
choose the combination
of benefits that best suits
their needs
Flexible Reward Systems
Flexible, or c afeteria-style, reward systems are a recent and increasingly
popular variation on the standard compensation system. A flexible reward
system allows employees, within specified ranges, to choose the combination
of benefits that best suits their needs . For example, a younger worker just
starting out might prefer to have especially strong health care coverage with
few deductibles. A worker with a few years of experience might prefer to ha ve
more child care benefits. A midcareer employee with more financial security
might prefer more time off with pay. And older workers might prefer to have
more rewards concentrated into their retirement plans.
Some organizations are starting to apply the flexible approac h to pay. For
example, employees sometimes ha ve the option of taking an annual salary
increase in one lump sum rather than in monthly increments. General Electric
recently implemented such a system for some of its managers. UNUM Corporation, a large insurance firm, allows all of its employees the option of dra wing a
full third of their annual compensation in the month of January. This makes it
easier for them to handle such major expenses as pu rchasing a new automobile, buying a home, or covering college education costs for their children. Obviously, the administrative costs of providing this level of flexibility are greater,
but many employees value this flexibility and ma y develop strong loyalty and
attachment to an employer who offers this kind of compensation package.
Participative Pay Systems
In keeping with the current trend toward worker involvement in­organizational
decision making, employee participation in the pay process is also increasing.
A participative pay system may involve the employee in the system’s design,
administration, or both. A pay system can be designed by staff members of
the organization’s human resources department, a committee of managers
in the organization, an outside consultant, the employees, or a combination
of these sources. Organizations that have used a joint management employee
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CHAPTER 6 | Motivating Behavior with Work and Rewards
task force to design the compensation system have generally succeeded in
designing and implementing a plan that managers could use and that employees believed in. Employee participation in administering the pa y system is
a natural extension of having employees participate in its design. Examples
of companies that have involved employees in the administration of the pa y
system include Romac Industries, where employees vote on the pa y of other
employees; Graphic Controls, where each manager’s pay is determined by a
group of peers; and the Friedman-Jacobs Company, where employees set their
own wages based on their perceptions of their performance.48
Pay Secrecy
When a company has a policy of open salary information, the exact sal ary amounts for employees are public knowledge. State governments, for
instance, make public the salaries of everyone on their pa yrolls. A policy of
complete secrecy means that no information is available to employees regarding other employees’ salaries, average or percentage raises, or salary ranges.
The National Labor Relations Board recently upheld an earlier ruling that
an employer’s starting or enforcing a rule that forbids “employees to discuss
their salaries” constitutes interference, restraint, and coercion of protected
employee rights under the National Labor Relations Act. Although a few organizations have completely public or completely secret systems, most have systems somewhere in the middle.
Expatriate Compensation
Expatriate compensation is yet another important issue in managing reward systems.49 Consider, for example, a manager living and working in Houston currently
making $450,000 a year. That income allows the manager to live in a certain kind
of home, drive a certain kind of car, have access to certain levels of medical care,
and live a certain kind of lifestyle. Now suppose the manager is asked to accept
a transfer to Tokyo, Geneva, Moscow, or London, cities where the cost of living is
considerably higher than in Houston. The same salary cannot begin to support a
comparable lifestyle in those cities. Consequently, the employer is almost certain
to redesign the manager’s compensation package so that the employee’s lifestyle
in the new location will be comparable to that in the old.
Now consider a different scenario. Suppose the same manager is asked to
accept a transfer to an underdeveloped nation. The cost of living in this nation
might be quite low by U.S. standards. But there ma y also be relatively few
choices in housing, poorer schools and medical care, a harsh climate, greater
personal danger, or similar unattractive c haracteristics. The firm will probably have to pay the manager some level of additional compensation to offset
the decrement in quality of lifestyle. Thus, developing rewards for expatriates
is a complicated process.
Figure 6.7 illustrates the approac h to expatriate compensation used by
one major multinational corporation. The left side of the figure shows how a
U.S. employee currently uses her or his salary—part of it goes for taxes , part
is saved, and the rest is consumed. When a person is asked to move abroad, a
human resource manager works with the employee to develop an equitable
balance sheet for the new compensation package. As shown on the right side
of the figure, the individual’s compensation package will potentially consist of
six components. First, the individual will receive income to cover what his or
her taxes and Social Security payments in the United States will be. The individual may also have to pay foreign taxes and additional U.S. taxes as a result
of the move, so the company covers these as well.
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239
240
PART 2 | Individual Behaviors and Processes in Organizations
Figure 6.7
Organizations that
ask employees to
accept assignments
in foreign locations
usually must adjust their
compensation levels to
account for differences
in cost of living and
similar factors. Amoco
uses the system shown
here. The employee’s
domestic base salary is
first broken down into
the three categories
shown on the left. Then
adjustments are made
by adding compensation
to the categories
on the right until an
appropriate, equitable
level of compensation is
achieved.
The Expatriate Compensation Balance Sheet
U.S. Expatriate Balance Sheet
U.S. Domestic Base Salary
U.S. hypothetical tax
and Social Security
Taxes
Foreign and excess
U.S. taxes
paid by company
Consumption
U.S. housing, transportation,
and other consumption
equivalence
Savings
Excess foreign costs
paid by company
U.S. levels
Foreign service
premium/hardship
added by company
Next, the firm also pays an amount adequate to the employee’s current consumption levels in the United States. If the cost of living is greater in the foreign
location than at home, the firm pays the excess foreign costs. The employee also
receives income for savings comparable to what he or she is currently sa ving.
Finally, if the employee faces a hardship because of the assignment, an additional foreign service premium or hardship allowance is added by the firm. Not
surprisingly, then, expatriate compensation packages can be very expensive for
an organization and must be carefully developed and managed.50
At the end of Chapter 5 we presented Table 5.1 to illustrate how the various theories of motivation discussed in that chapter could be used to address
several representative managerial challenges. Table 6.2 shows how the various motivational tools and tec hniques discussed in this c hapter might be
used for those same challenges. Keep in mind, of course, that each situation is
unique and that there are no guarantees of success. Still, though, these suggestions provide an effective starting point in helping managers know when to
use different motivation methods to address various challenges the workplace.
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CHAPTER 6 | Motivating Behavior with Work and Rewards
241
Table 6.2
Many different management challenges related to employee motivation can
be addressed through methods related to work and rewards
Managerial Challenges
Motivation Methods and Techniques
Job Participation & Flexible
Goal Performance
Design Empowerment Work
Setting Management Rewards
Firm has a low-cost business
strategy but needs to motivate
employees
x
An employee feels he cannot
meet his performance goals
x
x
An employee feels underpaid
relative to her coworkers
x
An employee engages in
inappropriate behavior
(bullying, ridiculing coworkers)
A talented employee is not
feeling challenged at work
x
x
x
Because the work is repetitive,
some employees find it boring
and hard to stay motivated
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
x
SUMMARY AND APPLICATION
Managers seek to enhance employee performance by capitalizing on the potential for motivated beha vior to improve performance. Methods often used to
translate motivation into performance involve work design, participation and
empowerment, alternative work arrangements , performance management,
goal setting, and rewards.
The essence of work design is how organizations define and structure
jobs. Historically, there was a general trend toward increasingly specialized jobs, but more recently the movement has consistently been away from
extreme specialization. Two early alternatives to specialization were job
rotation and job enlargement. Job enrichment approaches stimulated considerable interest in job design. The job characteristics theory grew from early
work on job enrichment. One basic premise of this theory is that jobs can be
described in terms of a specific set of motivational characteristics. Another
is that managers should work to enhance the presence of those motiva tional characteristics in jobs but should also take individual differences into
account.
Employee involvement using participative management and empow erment can help improve employee motivation in many business settings.
New management practices such as the use of various kinds of work teams
and of flatter, more decentralized methods of organizing are intended to
empower employees throughout the organization. Organizations that want
to empower their employees need to understand a variety of issues as they
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242
PART 2 | Individual Behaviors and Processes in Organizations
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go about promoting participation. Flexible work arrangements are commonly
used today to enhance motivated job performance . Among the more popular
alternative arrangements are compressed workweeks, flexible work schedules,
extended work schedules, job sharing, and telecommuting.
The goal-setting theory of motivation suggests that appropriate goal difficulty, specificity, acceptance, and commitment will result in higher levels of
motivated performance. Management by objectives, or MBO, extends goal setting throughout an organization by cascading goals down from the top of the
firm to the bottom.
Performance measurement is the process by which work behaviors are
measured and compared with established standards and the results recorded
and communicated. Its purposes are to evaluate employees’ work performance
and to provide information for organizational uses suc h as compensation,
personnel planning, and employee training and development. Three primary
issues in performance appraisal are who does the appraisals , how often they
are done, and how performance is measured.
The purpose of the reward system is to attract, retain, and motivate qualified employees and to maintain a pa y structure that is internally equitable
and externally competitive. Rewards have both surface and symbolic value.
Rewards take the form of money, indirect compensation or benefits, perquisites, awards, and incentives. Factors such as motivational impact, cost, and fit
with the organizational system must be considered when designing or analyzing a reward system.
The effective management of a reward system requires that performance
be linked with rewards. Managing rewards entails dealing with issues such as
flexible reward systems, employee participation in the pay system, the secrecy
of pay systems, and expatriate rewards.
REAL W O R LD R E S PO N S E
ORCHESTRATING OUTCOMES
The Orpheus Chamber Orchestra was conceived to
and unsolicited advice may be sharply rebuffed—
help eliminate the disconnect between motivation
and may, in fact, serve as grounds for dismissal. At
and satisfaction that exists in many orchestras.
Orpheus, says Parker, “we have a completely differ-
Indeed, the first principle in what’s now known as
ent structure to the way we approach rehearsal”: A
the “Orpheus Process” is this: “Put power in the
core team of players selected by the orchestra from
hands of the people doing the work.” In most orches-
each instrument section plans and leads rehearsals
tras, the conductor makes more or less autocratic
for a given piece of music.
decisions about what will be played and how. The
According to Harvey Seifter, a consultant special-
input of musicians is neither sought nor welcomed,
izing in relationships between business and the arts,
(Continued)
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CHAPTER 6 | Motivating Behavior with Work and Rewards
243
the Orpheus Process consists of five elements
places and times for certain things to be said. The
designed to put this principle into practice:
appropriate moment. Everybody knows what’s
1. Choosing leaders: For each piece of music
wrong, everybody can feel what’s wrong. But do
that the orchestra decides to perform, members
you have a solution? Do you know how to solve
select a leadership team composed of five to
a problem?”
seven musicians. This “core team” then leads
4. Perfecting the product: Just before each concert,
rehearsals and serves as a conduit for members’
a couple of members take seats in the hall to
input. It’s also responsible for seeing that the
listen to the performance from the audience’s
final performance reflects “a unified vision.”
perspective. Then they report to the full ensemble
2. Developing strategies: Prior to rehearsals, the core
and may suggest some final adjustments.
team decides how a piece of music will be played.
5. Delivering the product: The final performance is
Its ultimate goal is to ensure “an overall interpretive
the ultimate result of the Orpheus Process, but
approach to the music,” and it works to meet this
it isn’t the last step. When the concert is over,
goal by trying out various approaches to the music
members get together to share their impressions
during rehearsals with the full orchestra.
of the performance and to make suggestions for
3. Developing the product: Once an interpretive
even further refinements.
approach has been chosen, rehearsals are
“If you ask any musician in the orchestra why they
geared toward refining it. At this point, players
love playing with Orpheus,” says Parker, “it’s because
make suggestions and critique the playing of their
they feel empowered. They don’t have anyone telling
colleagues. It is, of course, a highly collaborative
them what to do. They walk into the rehearsal hall and
stage in the process, and its success depends on
it’s their opportunity to influence [and] shape music, to
mutual respect. “We’re all specialists—that’s the
make music with all their experience, all their training
beginning of the discussion,” says violinist Martha
coming together.” Ask double bass player Don Palma,
Caplin. “When I talk to … another musician in the
for instance. Palma took a sabbatical after one year with
group, it’s on an equal level. It’s absolutely crucial
Orpheus to play with the Los Angeles Philharmonic. “I
that we have that attitude.” When disagreements
just hated it,” he says. “I didn’t like to be told what to do
arise, everyone works toward a consensus, and if
all the time, being treated like I wasn’t really worth any-
a consensus can’t be reached, the issue is settled
thing other than to be a good soldier and just sit there
by a vote. Violinist Eriko Sato also emphasizes that
and do as I was told. I felt powerless to affect things. … I
the process of collaborative input works best when
felt frustrated, and there was nothing I could … do to
members focus their contributions on outcomes of
help make things better.” By contrast, says Palma,
the highest possible quality: “Fundamentally,” she
“Orpheus keeps me involved. I have some measure of
says, “I don’t think everybody’s opinion should
participation in the direction the music is going to take. I
be addressed at all times. There are certain
think that’s why a lot of us have stayed involved so long.”
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
244
PART 2 | Individual Behaviors and Processes in Organizations
DISCUSSION QUESTIONS
1. What are the primary similarities and differences between job enrichment
and the approach proposed by job characteristics theory?
2. What are the motivational consequences of increased employee involve ment from the frame of reference of expectancy and equity theories?
3. What motivational problems might result from an organization’s attempt
to set up work teams?
4. Which form of a f lexible work schedule might you prefer? How do you
think you would like telecommuting?
5. Develop a framework whereby an instructor could use goal setting in running a class such as this one.
6. Why are employees having their performance measured and evaluated all
the time instead of simply being left alone to do their jobs?
7. In what ways is your performance as a student evaluated? How is the performance of your instructor measured? What are the limitations of this method?
8. Can performance on some jobs simply not be measured? Why or why not?
9. As a student in this class, what “rewards” do you receive in exchange for
your time and effort?
UNDERSTAND YOURSELF EXERCISE
Making Tough Decisions
Listed below are your notes on the performance of eight managers who work
for you. Working alone, recommend salary increases for eight managers who
have just completed their first year with the company and are now to be con sidered for their first annual raise. Keep in mind that you may be setting precedents and that you need to keep salary costs down. However, there are no
formal company restrictions on the kind of r aises you can give. Indicate the
sizes of the raises that you would like to give eac h manager by writing a percentage next to each name.
Variations: The instructor might alter the situation in one of several ways.
One way is to assume that all of the eight managers entered the company at
the same salary, say $30,000, which gives a total salary expense of $240,000. If
upper management has allowed a salary raise pool of 10 percent of the current
salary expenses, then you as the manager have $24,000 to give out as raises.
In this variation, students can deal with actual dollar amounts rather than
just percentages for the raises. Another interesting variation is to assume
that all of the managers entered the company at different salaries , averaging $30,000. (The instructor can create many interesting possibilities for how
these salaries might vary.) Using whatever additional information provided
by your instructor, you must then suggest salaries for the different managers.
% Abraham McGowan. Abe is not, as far as you can tell, a good per former. You have checked your view with others, and they do not feel
that he is effective either. However, you happen to know he has one of
the toughest workgroups to manage. His subordinates have low skill
levels, and the work is dirty and hard. If you lose him, you are not
sure whom you could find to replace him.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 6 | Motivating Behavior with Work and Rewards
% Benjy Berger. Benjy is single and seems to live the life of a carefree
bachelor. In general, you feel that his job performance is not up to par,
and some of his “goofs” are well known to his fellow employees.
% Clyde Clod. You consider Clyde to be one of your best subordinates .
However, it is obvious that other people do not consider him to be an
effective manager. Clyde has married a ric h wife, and as far as you
know, he does not need additional money.
% David Doodle. You happen to know from your personal relationship
with “Doodles” that he badly needs more money because of certain
personal problems he is having. As far as you are concerned, he also
happens to be one of the best of your subordinates . For some reason,
your enthusiasm is not shared by your other subordinates , and you
have heard them make joking remarks about his performance.
% E llie Ellesberg. Ellie has been very successful so far in the tasks
she has undertaken. You are particularly impressed by this because
she has a hard job. She needs money more than many of the other
people, and you are sure that they respect her because of her good
performance.
% Fred Foster. Fred has turned out to be a very pleasant surprise to you.
He has done an excellent job, and it is generally accepted among the
others that he is one of the best people at the company. This surprises
you because he is constantly frivolous and does not seem to care very
much about money and promotion.
% G reta Goslow. Your opinion is that Greta is just not cutting the
mustard. Surprisingly enough, however, when you check to see how
others feel about her, you discover that her work is very highly
regarded. You also know that she badly needs a raise . She w as
recently widowed and is finding it extremely difficult to support
her household and her young family of four.
% Harry Hummer. You know Harry personally, and he just seems to
squander his money continually. He has a fairly easy job assignment,
and your view is that he does not do it particularly well. You are,
therefore, quite surprised to find that several of the other new managers think that he is the best of the new group.
After you have made the assignments for the eight people, you will have a
chance to discuss them either in groups or in the larger class.
Follow-Up Questions
1. Is there a clear difference between the highest and lowest performer?
Why or why not?
2. Did you notice differences in the types of information that you had
available to make the raise decisions? How did you use the different
sources of information?
3. In what ways did your assignment of raises reflect different views of
motivation?
Source: Lawler, E. E., III. (1975). Motivation Through Compensation, adapted by D. T. Hall. In
Instructor’s Manual for Experiences in Management and Organizational Behavior. New York: John
Wiley & Sons.
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245
246
PART 2 | Individual Behaviors and Processes in Organizations
GROUP EXERCISE
Fad Versus Substance
Albert Q. Fixx, the founder and CEO of your company, a small manufacturer
of auto parts, has long been committed to the continuous improvement of the
firm’s management practices through the application of modern management
techniques. It seems that Mr. Fixx spent the past weekend at a seminar con ducted by a nationally respected consultant on management effectiveness .
The principal speaker and the group sessions focused squarely on the use of
employee participation as means of improving company-wide productivity and
enhancing employees’ commitment to their jobs.
So inspired was Mr. Fixx by his weekend experience that he went straight
back to his office on Sunday night, where he composed and sent an e-mail that
all managers would find in their inboxes bright and early on Monday morning.
After recapping his eye-opening weekend, he wrote the following:
I am convinced that participative management is the key to improving
productivity at this company. Because you did not have the advantage
of attending the same seminar that I did, I am attaching copies of all
the handouts that were given to participants. They explain everything
you need to know about practicing participative management, and I
expect all of you to begin putting these principles into practice , starting this week. As of now, both I myself and this company are commit ted to participative management. Those of you who do not undertake
the application of participative-management principles in your departments will find it very difficult to remain with a forw ard-looking company like A.Q. Fixx.
Your instructor will divide the class into groups of four to seven people. Each
member of the group will pretend to be a manager at A.Q. Fixx, and your
group of “managers” will discuss each of the following issues. Be prepared to
discuss the group’s thinking on each issue, even if the group doesn’t reac h a
consensus.
Questions
1. What are the chances that Mr. Fixx’s e-mail will spur effective participative management at th e company? Are the odds better or worse
than 50/50?
2. How has each individual manager responded to the e-mail? Is your
response consistent with that of most group members, or do you find
yourself taking a stance that’s different, even if only slightly so? If
you’ve taken a different stance, do you think it’s worthwhile trying to
convince the group to come around to your way of thinking? Why or
why not?
3. What is the group’s opinion of Mr. Fixx’s approach to implementing
participative management at the company? If you don’t regard his ap proach as the best way of implementing participative practices—or his
e-mail as the best means of introducing the subject—discuss some
ways in which he could he have improved his approach.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 6 | Motivating Behavior with Work and Rewards
247
VIDEO EXERCISE
Flight 001
Until the late 1990s, Brad John and John Sencion worked in different areas of New
York’s fashion industry. Both traveled often between the United States, Europe,
and Japan for work. No matter how many times they began a trip, they spent the
days and hours racing all over town picking up last-minute essentials. By the time
they got to the airport, they were sweaty, stressed, and miserable—not exactly the
glamorous existence they envisioned when they got into the fashion industry.
Then, during a flight from New York to Paris in 1998, the weary travelers came
up with an idea for a one-stop travel shop targeted at fashion-forward globetrotters
like themselves. They called it Flight 001 and began selling guidebooks, cosmetics,
laptop bags, luggage, electronic gadgets, passport covers, and other consumer products. Flight 001 is now hailed as one of the most exciting businesses in the industry.
In addition to selling useful travel merchandise, the New York-based retailer offers
a unique shopping experience: Flight 001 stores are shaped like airplane fuselages
tricked out with retro airport décor and accessories. In the years to come, the founders expect to be in every major city in the United States, Europe, and Asia.
But as the company embarks on a new five-year plan, the stretch goal of
opening as many as thirty new stores in the United States and overseas is begin
ning to hit turbulence. Co-founder Brad John is determined to make Flight 001
the international authority on travel, but ambitious plans will require changes
to the company’s staffing, merchandising, and financial planning. With all the
talk about expansion and new product lines, it will be increasingly important
that Flight 001 not become distracted from what makes it special in the first
place: location, design, and an impeccable product line.
Questions
Now What?
PERCOM/SHUTTERSTOCK.COM
1. Can you describe Brad’s motivation in terms of the goal-setting theory of
motivation?
2. How does Emily see her job from the standpoint of motivating Flight 001
employees? What motivates her?
3. What are the roles of performance management and individual rewards in
a start-up company like Flight 001?
VIDEO C A S E
Imagine that a coworker is complaining to you about being upset after learning
that another coworker is being paid more despite the complaining coworker
being at the company a year longer. What do you say or do? Go to this chapter’s
“Now What?” video, watch the challenge video, and choose a response. Be sure
to also view the ­outcomes of the two responses you didn’t choose.
Discussion Questions
1. What role do rewards play in this situation? How do the surface and sym bolic values of the rewards influence what happens?
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
248
PART 2 | Individual Behaviors and Processes in Organizations
2. In chapter 5 we discussed equity theory. How do the concepts from equity
theory apply to this situation? Explain your answer.
3. As a manager, what could you have done to better handle the situation?
Why would this be a better solution?
ENDNOTES
1 Schweitzer, V. (2007, Ma y 7). Pla yers with No Conduc tor and, Increasingly, with No F ear. The New York Times;
­Tommasini, A. (2008, October 18). The Pluses and Minuses
of Lac king a Conductor . The New York Times; Higgs , J.
(2008, October 28). Orpheus Chamber Orchestra Embodies Democratic Principles. Axiom News; Gordon, A. (2009,
April 25). Self-Governing Orpheus Chamber Orchestra Has
Broader Lessons to Offer, Says Banking and Civic Leader
John Whitehead. New York Sun; Seifter, H. (2001, Summer).
The Conductorless Orchestra. Leader to Leader Journal, 21;
Hackman, J. R. (2002). Leading Teams: Setting the Stage
for Great Performances. Cambridge, MA: Harvard Business
School Press.
2Griffin, R. W., & McMahan, G. C. (1994). Motivation Through
Job Design. In Organizational Behavior: State of the Science,
ed. J. Greenberg (pp. 23–44). New York: Lawrence Erlbaum
Associates; see also Grant, A. M., Fried, Y. & J uillerat, T.
(2010). Work Matters: Job Design in Classic and Contempo rary Perspectives. In Handbook of Industrial and Organizational Psychology, ed. S. Zedeck (pp. 417–453). Washington,
DC: American Psychological Association.
3Taylor, F. W. (1911). The Principles of Scientific Management.
New York: Harper & Row.
4Griffin, R. W. (1982) Task Design: An Integrative Approach.
Glenview, IL: Scott, Foresman.
5 Conant, H. & Kilbridge , M. (1965). An Interdisciplinary
Analysis of Job Enlargement: Technology, Cost, Behavioral
Implications. Industrial and Labor Relations Review , 18(7),
377–396.
6 Herzberg, F. (1968, January–February). One More Time:
How Do You Motivate Employees? Harvard Business Review,
53–62; Frederick Herzberg, F. (1974, September–October).
The Wise Old Turk. Harvard Business Review, 70–80.
7 Ford, R. N. (1973, J anuary–February). J ob Enric hment
­Lessons from AT&T. Harvard Business Review, 96–106.
8Weed, E. D. (1971). Job Enrichment “Cleans Up” at Texas
Instruments. In New Perspectives in J ob Enrichment, ed.
J. R. Maher. New York: Van Nostrand.
9Griffin, R. W. (1982) Task Design: An Integrative Approach.
Glenview, IL: Scott, Foresman; Griffin, R. W., & McMahan, G. C.
(1994). Motivation Through Job Design. In Organizational
Behavior: State of the Science , ed. J. Greenberg (pp. 23–44).
New York: Lawrence Erlbaum Associates.
10Hackman, J. R., & Oldham, G. (1976). Motivation Through
the Design of Work: Test of a Theory. Organizational Behavior and Human Performance, 16, 250–279. See also Michael
A. Campion, M. A., & Thayer, P. W. (1987, Winter). Job Design:
Approaches, O utcomes, a nd Trade-Offs. Organizational
Dynamics, 66–78.
11Griffin, R. W. (1982) Task Design: An Integrative Approach.
Glenview, IL: Scott, Foresman.
12Griffin, R. W. (1982) Task Design: An Integrative Approach.
Glenview, IL: Scott, Foresman. See also Roberts, K. H., &
Glick, W. (1981). The Job Characteristics Approach to Task
Design: A Critical Review. Journal of Applied Psychology, 66,
193–217; and Griffin, R. W. (1987). Toward an Integrated Theory of Task Design. In Research in Organizational Behavior,
eds. L. L. Cummings & B. M. Staw (Vol. 9, pp. 79–120). Greenwich, CT: JAI Press.
13Ricky W. Griffin, R. W., Welsh, N. A., & Moorhead, G. (1981,
October). Perceived Task Characteristics and Employee
­Performance: A Literature Review. Academy of Management
Review, 655–664.
14See Butler, T., & Waldroop, J. (1999, September–October).
Job Sculpting. Harvard Business Review, 144–152; see also
the recent special issue of the Journal of Organizational
Behavior ( 31, 2–3, February 2010) devoted entirely to job
design.
15Glew, D. J., O’Leary-Kelly, A. M., Griffin, R. W., & Van Fleet,
D. D. (1995). Participation in Organizations: A Preview of the
Issues and Proposed Framework for Future Analysis. Journal
of Management, 21(3), 395–421; for a recent update, see Forrester, R. (2002). Empowerment: Rejuvenating a Potent Idea.
Academy of Management Executive, 14(1), 67–78.
16Whitney, K. (2008). Netflix Creates its Own Script for Talent
Management, Talent Management, July 1. Available online:
http://talentmgt.com/articles/view/netflix_creates_its _own_
script_for_talent_management/1; Conlin, M. (2007, September 24). Netflix: Flex to the Max. BusinessWeek, 73–74.
17 Workplacedemocracy. (2010, January 18). Netflix Takes
a Vacation from Its Vacation P olicy. Workplacedemocracy.com. http://workplacedemocracy.com/2010/01/18/
netflix-takes-avacation-from-its-vacation-policy/.
18 Henneman, T. (2011, November 7). Patagonia Fills Pay-
roll With People Who Are Passionate, Workforce. Available online: http://www.workforce.com/article/20111104/
NEWS02/111109975.
19Whetton, D. A., & Cameron, K. S. (2002). Developing Management Skill s (pp . 426–427). Upper Sad dle River, NJ:
Prentice-Hall.
20George, E., & Ng, C. K. (2010). Nonstandard Workers: Work
Arrangements and Outcomes. In Handbook of Industrial and
Organizational Psychology, ed. S. Zedeck (pp. 573–596). Washington, DC: American Psychological Association.
21Cohen A. R., & Gadon, H. (1978). Alternative Work Sched-
ules: Integrating Individual and Organizational Needs. Reading, MA: Addison-Wesley); see also Kossek, E. E., & Michel, J.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 6 | Motivating Behavior with Work and Rewards
S. (2010). Flexible Work Schedules. In Handbook of Industrial
and Organizational Psychology, ed. S. Zedeck (pp. 535–572).
Washington, DC: American Psychological Association.
22100 Best Companies to Work For 2012. www.fortune.com.
23See Rau, B., & and Hyland, M. (2002). Role Conflict and
Flexible Work Arrangements: The Effects on Applicant Attraction. Personnel Psychology, 55(1), 111–136.
24Working 9-to-5 No Longer. USA Today, December 6, 2004,
1B, 2B.
255 Flextime-Friendly Companies. Careerbuilder.com, ­December
18, 2009. Available online: www.careerbuilder.com/Article/
CB-632-Job-Search-Strategies-5-Flextime-Friendly-Companies.
26For a recent analysis, see Raghuram, S., Garud, R., Wiesen-
feld, B., & Gupta, V. (2001). Factors Contributing to Virtual
Work Adjustment. Journal of Management, 27, 383–406.
27Katzenbach, J. R., & Santamaria, J. A. (1999, May–June).
Firing Up the F ront Line . Harvard Business Review ,
107–117.
28 Bandura, A. (1977). Social Learning Theory. Englewood
Cliffs, NJ: Prentice Hall.
29See Locke, E. A. (1968). Toward a Theory of Task Performance and Incentives. Organizational Behavior and Human
Performance, 3, 157–189.
30Latham, G. P., & Yukl, G. (1975). A Review of Research on
the Application of Goal Setting in Organizations. Academy of
Management Journal, 18, 824–846.
31Latham, G. P., & Baldes, J. J. (1975). The Practical Significance of Locke’s Theory of Goal Setting. Journal of Applied
Psychology, 60, 187–191.
32 Latham, G. P. (2001). The Importance of Understanding
and Changing Employee Outcome Expectancies for Gaining
Commitment to an Organizational Goal. Personnel ­Psychology,
54, 707–720.
33See Zacharatos, A., Barling, J., & Iverson, R. (2005, J
­ anuary).
High-Performance Work Systems and Occupational Safety.
Journal of Applied Psychology, 90(1), 77–94.
34 Bernardin, H. J., & Beatty , R.
W. (1984). Performance
Appraisal: Assessing Human Behavior at Work. Boston: Kent);
see also Wildman, J. L., Bedwell, W. L., Salas, E., & SmithJentsch, K. A. (2010) Performance Measurement at Work: A
Multilevel Perspective. In Handbook of Industrial and Organizational Psychology, ed. S. Zedeck (pp. 303–341). Washington, DC: American Psychological Association.
35 Brett, J., & Atwater, L. (2001). 360° Feedback: Accuracy,
Reactions, and Perceptions of Usefulness. Journal of Applied
Psychology, 86(5), 930–942; Beehr, T., Ivanitskaya, L., Hansen, C., Erofeev, D., & Gudanowski, D. (2001). Evaluation of
360-Degree Feedback Ratings: Relationships with Each Other
and with Performance and Selection Predictors . Journal of
Organizational Behavior, 22, 775–788.
36 Druskat, V. U., & Wolff, S. B. (1999). Effects and Timing
of Developmental Peer Appraisals in Self-Managing Work
Groups. Journal of Applied Psychology, 84 (1), 58–74.
37Sammer, J. (2008, January). Calibrating Consistency. HR
Magazine, 73–78.
249
38See Kaplan, R., & Norton, D. (1996). The Balanced Scorecard: Translating Strategy Into Action. Cambridge, MA: Harvard Business Review Press; and Kaplan, R., & Norton, D.
(2006). Alignment: Using the Balanced Scorecard to ­Create
Corporate Synergies . Cambridge, MA: Harvard Business
Review Press.
39See Lawler, E. E. (1981). Pay and Organization Develop -
ment. Reading, MA: Addison-Wesley, 1981); see also Martocchio, J. J. (2010). Strategic Reward and Compensation Plans.
In Handbook of Industrial and Organizational Psychology, ed.
S. Zedeck (pp. 343–372). Washington, DC: American Psychological Association.
40Boyd, B, & Salamin, A. (2001). Strategic Reward Systems: A
Contingency Model of Pay System Design. Strategic Management Journal, 22, 777–792.
41References: Stossel, J., et al. (2007, September 14). Health
Savings Accounts: Putting Patients in Control. ABC News.
Available online: http://abcnews.go.com; Mackey, J. (2009,
August 11). The Whole Foods Alternative to ObamaCare. Wall
Street Journal. Available at: http://online.wsj.com; Dugan, J.
(2009, August 20). Whole Foods’ Crummy Insurance: What
John Mackey Means by “Choice.” Consumer Watchdog. Available online: www.consumerwatchdog.org; Emily Friedman, E.
(2009, August 14). Health Care Stirs Up Whole Foods CEO
John Mackey, Customers Boycott Organic Grocery Store. ABC
News. Available online: http://abcnews.go.com; Paumgarten,
N. (2010, January 4). Food Fighter. The New Yorker. Available
online: www.newyorker.com; Whole Foods CEO John Mackey
Stepping Down as Chairman. Huffington Post, December 25,
2009. ­Available online: www.huffingtonpost.com.
42Rappaport, A. (1999, March–April). New Thinking on How
to Link Executive Pay with Performance. Harvard Business
Review, 91–99; see also Devers, C., Cannella, A., Jr., Reilly,
G., & Yoder, M. (2007). Executive Compensation: A Multidisciplinary Review of Recent Developments. Journal of Management, 33(6), 1016–1072.
43 Bates, S . (2002,
Ma y). Piecing Together Executive
­Compensation. HR Magazine, 60–69.
44Welcome to Silicon Valley: Perksville, USA. USA Today, July
5, 2012, 1A.
45 Painless Perks. Forbes, September 6, 1999, 138; see also
Does Rank Have Too Much Privilege? Wall Street Journal,
February 26, 2002, B1, B4.
46Garvey, C. (2004, August). Meaningful Tokens of Appreciation. HR Magazine, 101–106.
47 Deckop, J. R., Mangel, R., & Cirka, C. C. (1999). Getting
More Than You Pay For: Organizational Citizenship B
­ ehavior
and Pay-for-Performance Plans. Academy of Management
Journal, 42(4), 420–428.
48Garvey, C. (2002, May). Steering Teams with the Right Pay.
HR Magazine, 70–80.
49 Poe, A. (2002, April). Selection
77–80.
Savvy. HR Magazine,
50Griffin, R. W., & Pustay, M. W. (2005). International Business—A Managerial Perspective (8th ed.). Upper Saddle River,
NJ: Pearson, 2015.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
Copyright 2017 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).
Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
PART
3
SOCIAL AND GROUP PROCESSES
IN ORGANIZATIONS
CHAPTER 7
Groups and Teams
CHAPTER 8
Decision Making and Problem Solving
CHAPTER 9
Communication
M
SH ON
U G
TT M
ER UL
ST TI
O PL
CK Y/
.C
O
M
LOSKUTNIKOV/SHUTTERSTOCK.COM
CHAPTER 10 Managing Conflict and Negotiating
As you should recall from Chapter 1, managers work to make their organizations effective by enhancing performance behaviors,
enhancing commitment and engagement, promoting citizenship behaviors, and minimizing dysfunctional behaviors by their
employees. Chapter 2 identified several environmental factors that must be considered. In Part 2 we asked the question “Why
do individuals do what they do?’ and addressed this question by discussing individual characteristics, values, perceptions, and
reactions, employee motivation concepts and theories, and how work and rewards can be used to enhance motivation.
In Part 3 we ask a different question: “Why do groups and teams do what they do?” As was the case with individuals, we need
to look at a number of different perspectives to better understand group and team behaviors and their role in promoting organizational
effectiveness. We start in Chapter 7 by discussing groups and teams as essential parts of organizations and therefore a major
determinant of the success of any organization. We then describe decision making and problem solving in Chapter 8. Although decision
making may also be an individual activity, it often takes place in a group or team context and usually affects others. Communication
is covered in Chapter 9. Finally, Chapter 10 addresses another important set of factors related to groups and teams, conflict and
negotiation. At the conclusion of Part 3 you should have a clearer understanding of why groups and teams do what they do.
How does the
environment matter?
Why do individuals
do what they do?
• Individual
characteristics
• Individual values,
perceptions, and
reactions
• Motivating behavior
• Motivating behavior
with work and
rewards
Why does leadership
matter?
• Traditional leadership
approaches
• Modern leadership
approaches
• Power, influence, and
politics
What makes managers
and organizations effective?
• Enhancing performance
behaviors
• Enhancing commitment and
engagement
• Promoting citizenship
behaviors
• Minimizing dysfunctional
behaviors
How does the
environment matter?
Why do groups and
teams do what they
do?
• Groups and teams
• Decision making and
problem solving
• Communication
• Conflict and
negotiation
How do
organizational
characteristics
influence
effectiveness?
• Organization structure
and design
• Organization culture
• Change management
PHANT/SHUTTERSTOCK.COM
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CHAPTER
7
GROUPS AND TEAMS
Real World Challenge: Teamwork at
Starbucks
CHAPTER
OUTLINE
TYPES OF GROUPS AND TEAMS
Workgroups
Teams
Informal Groups
GROUP PERFORMANCE FACTORS
Improve Your Skills: Diagnosing Team
Problems
Group Compositions
Group Size
Group Norms
Group Cohesiveness
Understand Yourself: Are You
Emotionally Intelligent?
Informal Leadership
CREATING NEW GROUPS AND TEAMS
Stages of Group and Team
Development
LEARNING
OUTCOMES
Understanding Team Performance
Factors
The Implementation Process
MANAGING TEAMS
Understanding Benefits and Costs of
Teams
Case Study: Teamwork at IDEO
Promoting Effective Performance
Teamwork Competencies
EMERGING TEAM OPPORTUNITIES AND
CHALLENGES
Virtual Teams
Diversity and Multicultural Teams
Global Issues: Increasing the
Effectiveness of Multicultural Teams
SUMMARY AND APPLICATION
Real World Response: Teamwork at
Starbucks
After studying this chapter, you should be
able to:
process in the context of creating new
teams.
1 Define groups and teams and identify
4 Identify the primary benefits and costs
and describe several types of each.
2 Identify the five core group
performance factors and relate them
to groups and teams in organizations.
3 Discuss the stages of group and team
development, other team performance
factors, and the implementation
of teams, how managers can promote
effective team performance, and
important team competencies.
5 Describe emerging team opportunities
and challenges related to virtual
teams and diversity and multicultural
teams.
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TEAMWORK AT STARBUCKS
Coffee giant Starbucks believes that teamwork is essential to its strategic execution and ultimate
success.1 Reinforcing this belief, Starbucks’ core values include teamwork, diversity, and equal
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REAL WORLD CHALLENGE
participation. Employees are called by their first names and are referred to as “partners” rather
than by hierarchical titles. Teamwork is seen as so important to the company’s success that new
hires spend several days learning how to be part of the Starbucks team. Employees also work
together on the front line, eliminating the distance between different statuses.2
When Starbucks started planning for its expansion into South Korea it realized that
the country’s culture valued hierarchical relationships and power distance, which were
inconsistent with the company’s equality and teamwork values. Starbucks had to decide
if it wanted to change its organizational structure in South Korea to better fit the country’s
national culture, or stay the same to maintain its core values.3
Imagine that Starbucks asks for your advice on how it should handle its expansion into
South Korea. After reading this chapter, you should have some good ideas.
MICHELLE GILDERS / ALAMY
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254
PART 3 | Social and Group Processes in Organizations
In Chapter 1 we noted the pervasiveness of human beha vior in organizations
and the importance of interactions among people as critical to achieving important outcomes for organizations. Indeed, a great deal of all managerial work
involves interacting with other people, both directly and indirectly and both
inside and outside the organization. Moreover, much of the work in organizations is accomplished by people working together in groups and teams . This
chapter is the first of four that deal primarily with interpersonal processes
in organizations. The opening pages to this part again present the organizing framework for this book we developed back in Chapter 1. This will enable
you to better understand where we are in our discussion and what lies ahead.
We begin in this chapter by discussing groups and teams in organizations. In
the next three chapters in this part we focus on decision making and problem
solving (Chapter 8), interpersonal communication (Chapter 9), and conflict
and negotiation (Chapter 10).
TYPES OF GROUPS AND TEAMS
group
Two or more people who
interact with one another
such that each person
influences and is influenced
by each other person
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team
An interdependent
collection of at least two
individuals who share a
common goal and share
accountability for the
team’s as well as their
own outcomes
There are literally hundreds of definitions of the term group. Groups have
been defined in terms of perceptions, motivation, organization, interdependencies, interactions, and myriad other elements. We will simply define a group
as two or more persons who interact with one another such that each person influences and is influenced by eac h other person. 4 Two people who are
­physically near each other are not a group unless they interact and have some
influence on each other. Coworkers may work side by side on related tasks—
but if they do not interact, they are not a group.
We should also note that groups and teams are not necessarily the same
thing. All teams are groups, but not all groups are teams. We will define teams
as an interdependent collection of at least two individualswho share a common
goal and share accountability for the team’ s as well as their own o­ utcomes.5
A key part of this definition is that team members are interdependent with
respect to information, resources, and
skills. As tasks become more complex,
they require greater coordination among
team members. Team members’ roles
become interdependent, increasing the
need for teamwork, reciprocal commu nication, and feedbac k. Communication
and collaboration demands also increase
dramatically.6 So, all teams are groups, but
groups are not n
­ ecessarily teams. For the
sake of convenience we will generally use
terms ‘groups’ and ‘teams’ ­interchangeably
in this discussion.
Groups are prevalent throughout most organizations. A
variety of different kinds of workgroups and teams like this
one perform many different kinds of functions and play a
number of different roles.
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CHAPTER 7 | Groups and Teams
255
Workgroups
workgroup
A formal group formed
by an organization to do
its work
command group
A relatively permanent,
formal group with
functional reporting
relationships and is
usually included in the
organization chart
affinity groups
Collections of employees
from the same level in
the organization who
meet on a regular basis
to share information,
capture emerging
opportunities, and solve
problems
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Workgroups are formal groups established by the organization to do its work.
Workgroups include command (or functional) groups and affinity groups (as
well as teams). A command group is relatively permanent and is c haracterized by functional reporting relationships suc h as ha ving both a group
manager and those who report to the manager. Command groups are usually
included in the organization chart. Affinity groups are relatively permanent
collections of employees from the same level in the organization who meet on a
regular basis to share information, capture emerging opportunities, and solve
problems.7
In business organizations, most employees work in command groups , as
typically specified on an official organization chart. The size, shape, and organization of a company’s command groups can vary considerably. Typical command groups in organizations include the quality-assurance department, the
customer service department, the cost-accounting department, and the human
resource department. Other types of command groups inc lude work teams
organized as in the J apanese style of management, in which subsections of
manufacturing and assembly processes are each assigned to a team of workers. The team members decide among themselves who will perform each task.
Affinity groups are a special type of formal group: They are set up by the
organization, yet they are not really part of the formal organization struc ture. They are not really command groups because they are not part of the
organizational hierarchy, yet they are not task groups because they sta y in
existence longer than any one task. Affinity groups are groups of employees
who share roles, responsibilities, duties, and interests, and which represent
horizontal slices of the normal organizational hierarchy. Because the members
share important characteristics such as roles, duties, and levels, they are said
to have an affinity for one another. The members of affinity groups usually
have very similar job titles and similar duties but are in different divisions or
departments within the organization.
Affinity groups meet regularly, and members ha ve assigned roles suc h
as recorder, reporter, facilitator, and meeting organizer.
­M embers follow simple rules suc h as
communicating o penly a nd h onestly,
listening actively, respecting confiden tiality, honoring time agreements , being
prepared, staying focused, being individually accountable , and being supportive
of each other and the group . The greatest
benefits of affinity groups are that they
cross existing boundaries of the organiza tion and facilitate better communication
among diverse departments and divisions
throughout the organization. For instance,
the Eli Lilly Company formally recognizes
Employees sometimes form groups to discuss or pursue
common interests. These co-workers, for example,
formed a book club. They periodically meet during their
lunch break to discuss a book that they are all reading.
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256
PART 3 | Social and Group Processes in Organizations
eight affinity groups within its organization. One focuses on Chinese Culture.
Its members, including both Chinese and non-Chinese employees, meet regularly to help bridge cultural differences. Another group at Eli Lilly is called the
Women’s Network and focuses on gender issues . Employees in some compa nies form book clubs and meet regularly to discuss books of common interest.
Teams
functional team
A team whose members
come from the same
department or functional
area
cross-functional team
A team whose members
come from different
departments or functional
areas
Organizations also use a wide variety of different types of teams . The most
common types of teams are summarized in Table 7.1. There are many different types of teams. Each type of team is composed of different members and
responsible for different types of tasks. The members of functional teams
come from the same department or functional area. A team of marketing
employees and a team of finance employees are examples of functional teams.
Cross-functional teams have members from different departments
or functional areas. This is one of the most common types of work teams.
An example of a cross-functional team is a top management team with members
representing different functions or units of the organization.Some organizations
are organized such that the company’s core work is done in cross-­functional
teams. For example, IDEO, a product innovation and design company, believes
that interdisciplinary teamwork boosts innovation and creativity.8 Teams share
and improve ideas, building on their members’ skills and providing more opportunities for problem solving. Steelcase; IDEO; Hammel, Green, and Abrahamson; and the Mayo Clinic all use cross-functional teams comprised of employees
with different expertise to enhance creativity and team performance.9
Cross-functional teams ha ve several strengths . In addition to getting
things done faster, particularly customer service and new product develop ment, they can increase creativity. Cross-functional teams also improve a
firm’s ability to solve complex problems by bringing different skill sets, perceptions, and experiences together. Because they bring diverse people from different functional areas together, they also increase employees’ knowledge about
other areas of the organization. The same diversity that can be a strength for
Table 7.1
Types of Teams
Functional teams
members come from the same department or functional area
Cross-functional teams
members come from different departments or functional areas
Problem-solving teams
teams created to solve problems and make improvements
Self-directed teams
set their own goals and pursue them in ways defined by the
team
Venture teams
teams that operate semi-autonomously to create and develop
new products, processes, or businesses
Virtual teams
teams of geographically and/or organizationally dispersed
coworkers who communicate using telecommunications and
information technologies
Global teams
face-to-face or virtual teams whose members are from
different countries
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CHAPTER 7 | Groups and Teams
problem-solving teams
Teams established to
solve problems and make
improvements at work
self-directed teams
Teams that set their own
goals and pursue them
in ways decided by the
team
venture teams
Teams that operate
semi-autonomously to
create and develop
new products (product
development teams),
processes (process design
teams), or businesses
(venture teams)
virtual teams
Teams of geographically
and/or organizationally
dispersed coworkers
who communicate using
the Internet and other
information technologies
Virtual teams are becoming increasingly common in
organizations. New forms of technology, coupled
with pressures to reduce travel costs, make it easy for
colleagues who are geographically dispersed to interact
in ways that mirror face-to-face interactions. Of course,
they may also have a reduced personal connection with
their colleagues when meeting this way.
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cross-functional teams can also be a weakness if this diversity is not properly
managed and conflicts are not effectively handled.
Problem-solving teams are teams established to solve problems and
make improvements at work. The core strength of problem-solving teams
is that because employees are the ones actually doing the work, they usually know the job best. Putting employees on teams responsible for solving
problems puts this expertise to work. For example, Colgate and JM Huber,
a raw material supplier, jointly assembled a multidisciplinary team to iden tify ways to reduce costs. The team ultimately realized sa vings of hundreds
of thousands of dollars.10 Quality circles can exist for long periods whereas
suggestion teams are short-lived and assembled to address specific issues .
Problem-solving teams can also increase employees’ commitment to decisions
because they were involved in making them. Organizations are increasingly
turning to outside teams to help them solve important problems . When online
movie rental site Netflix sponsored a contest to improve the accuracy of its
movie recommendation system, more than 40,000 teams from 186 countries
formed to vie for the million dollar prize.11
Self-directed teams set their own goals and pursue them in ways decided
by the team. Team members are responsible for tasks typically reserved for
team leaders or managers, including scheduling work and vacations, ordering
supplies, and evaluating their performance. At 3M, self-directed work teams
have made improvements in products, services, and processes while increasing customer responsiveness, lowering operating costs, increasing productivity, and decreasing cycle times. Self-directed teams can improve commitment,
quality, and efficiency. Cross-trained team members also help to increase the
flexibility of the team during staffing shortages . Self-directed teams are difficult to implement, however, as they require specific self-management and
team skills that many employees lack.
Venture teams are teams that operate semi-autonomously to create and
develop new products (product development teams), processes (process design
teams), or businesses (venture teams). 12 Separating a team from the formal
structure of the rest of the organization can enhance its innovativeness and
speed up cycle time.
Virtual teams are teams of geographically and/or organizationally dis persed coworkers who communicate using the Internet and other information
technologies. 13 Some virtual team members ma y
never see each other face-to-face. Many organizations use virtual teams to accomplish a variety of
goals. For example, PricewaterhouseCoopers, one
of the world’s largest accounting firms, with more
than 130,000 employees in 148 countries, uses virtual teams to bring employees from around the
globe “together” for a week or two to prepare work
257
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258
PART 3 | Social and Group Processes in Organizations
global teams
Teams with members from
different countries
for a particular client. The Whirlpool Corporation used a virtual team com posed of experts from the United States, Brazil, and Italy during a two-year
project to develop a chlorofluorocarbon-free refrigerator.14 You will learn more
about virtual teams later in this chapter.
Global teams have members from different countries . Global teams
can be virtual or meet face-to-face. Procter & Gamble, a multinational
manufacturer of family, personal, and household care products, uses global
teams to allow employees at its Cincinnati headquarters to collaborate
with employees and suppliers all over the world. Bosch und Siemens Hausgeräte GmbH (BSH) is a global company that operates 31 production sites
and 43 factories in 15 countries across Europe, Asia, the United States,
and Latin America. The company sells household appliances under brand
names including Bosch and Siemens, and uses global teams of employees
from Spain, China, and Latin America to develop technologies and concepts
for new products.
Informal Groups
informal group
Is established by its
members
friendship group
Is relatively permanent
and informal and draws
its benefits from the social
relationships among its
members
interest group
Is relatively temporary
and informal and is
organized around a
common activity or
interest of its members
Whereas formal groups and teams are established by an organization,
­informal groups are formed by their members and consist of friendship
groups, which are relatively permanent, and interest groups, which may be
shorter-lived. Friendship groups arise out of cordial relationships among
members and the enjoyment they get from being together . Interest groups
are organized around a common activity or interest, although friendships may
develop among members.
Good examples of interest groups are the networks of working women
that have developed over the last few decades. Many of these groups began
as informal social gatherings of women who wanted to meet with other
women working in male-dominated organizations, but they soon developed
into interest groups whose benefits went far beyond their initial social
purposes. The networks became information systems for counseling , job
placement, and management training . Some networks were eventually
established as formal, permanent associations; some remained informal
groups based more on social relationships than on any specific interest;
others were dissolved. These groups may be partly responsible for the dramatic increase in the percentage of women in managerial and administra tive jobs.
GROUP PERFORMANCE FACTORS
The performance of any group is affected by several factors (in addition to
its reasons for forming and the stages of its development, discussed later).
In a high-performing group, a group synergy often develops in which the
group’s performance is more than the sum of the individual contributions of
its members. Several additional factors may account for this accelerated performance.15 The five basic group performance factors ar e composition, size,
norms, cohesiveness, and informal leadership. If you are part of a group or
team that is not performing effectively, the Improve Your Skills feature might
be a useful diagnostic tool.
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259
IMPROVE YOUR SKILLS
DIAGNOSING TEAM PROBLEMS
Here are some questions you can ask in diagnosing team
issues.
1.
Clear direction
• Can team members each articulate the purpose
that the team exists to achieve?
2. A real team task
• Is the team assigned collective responsibility for all
of its customers and major outputs?
• Does the team make collective decisions
about work strategies (rather than leaving it to
individuals)?
• Are team members willing and able to help each
other?
• Does the team get team-level feedback about its
performance?
3. Team rewards
• Are more than 80 percent of all rewards available
to teams only, and not to individuals?
4. Basic material resources
• Does the team have its own meeting space?
• Can the team easily get the basic materials it
needs to do its work?
5.
Authority to manage the work
• Do team members have the authority to decide the following without first receiving special
authorization?
• How to meet client demands
• Which actions to take, and when
• Whether to change their work strategies when
they deem necessary
6. Team goals
• Can team members articulate specific and shared
team goals?
7. Improvement norms
• Do team members encourage each other to detect
and solve problems?
• Do members openly discuss differences in what
members have to contribute to the team?
• Do members encourage experimentation with new
ways of operating?
• Does the team actively seek to learn from other
teams?
Source: Wageman, R. (1997, Summer). Critical Success Factors for Creating Superb Self-Managing Teams. Organizational Dynamics, 26 (1), 59.
Group Composition
The composition of a group plays an important role in determining group
­p roductivity. 16 Group composition is most often described in terms of
the homogeneity or heterogeneity of the members. A group is homogeneous if
the members are similar in one or several w ays that are critical to the work
of the group, such as in age, work experience, education, technical specialty,
or cultural background. In heterogeneous groups, the members differ in one or
more ways that are critical to the work of the group. Homogeneous groups
often are created in organizations when people are assigned to command
groups based on a similar technical specialty. Although the people who work in
such command groups may differ in some ways, such as in age or work experience, they are homogeneous in terms of a critical work performance variable:
technical specialty.17
A substantial amount of research has explored the relationship between
a group’s composition and its productivity. The group’s heterogeneity in terms
of age and tenure with the group has been shown to be related to turnover:
Groups with members of different ages and experiences with the group tend to
experience frequent changes in membership.18 A homogeneous group is likely
to be more productive when the group task is simple, cooperation is necessary, the group tasks are sequential, or quick action is required. A heterogeneous group is more likely to be productive when the task is complex, requires
group composition
The degree of similarity
or difference among
group members on
factors important to the
group’s work
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CHAPTER 7 | Groups and Teams
PART 3 | Social and Group Processes in Organizations
a collective effort (that is, each member does a different task, and the sum
of these efforts constitutes the group output), demands creativity, and when
speed is less important than thorough deliberations . For example, a group
asked to generate ideas for marketing a new product probably needs to be heterogeneous to develop as many different ideas as possible.
The link between group composition and type of task is explained by the
interactions typical of homogeneous and heterogeneous groups . A homogeneous group tends to have less conflict, fewer differences of opinion, smoother
communication, and more interactions. When a task requires cooperation and
speed, a homogeneous group is therefore more desirable. If, however, the task
requires complex analysis of information and creativity to arrive at the best
possible solution, a heterogeneous group may be more appropriate because it
generates a wide range of viewpoints. More discussion and more conflict are
likely, both of which can enhance the group’s decision making.
Group composition becomes especially important as organizations become
increasingly more culturally diverse.19 Cultures differ in the importance they
place on group membership and in how they view authority, uncertainty, and
other important factors. Increasing attention is being focused on how to deal
with groups made up of people from different cultures .20 In general, a manager in charge of a culturally diverse group can expect several things . First,
members will probably distrust one another. Stereotyping will present a problem, and communication problems will almost certainly arise. Thus, managers
need to recognize that such groups will seldom function smoothly, at least at
first. Managers may therefore need to spend more time helping a culturally
diverse group through the rough spots as it matures, and they should allow a
longer-than-normal time before expecting it to carry out its assigned task.
Group Size
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A group can have as few as two members or as many members as can interact
and influence one another. Group size—the number of people in the group—
can have an important effect on performance . A group with many members
has more resources a vailable and may be able to complete
a large number of relatively independent tasks . In groups
established to generate ideas , those with more members
tend to produce more ideas , although the rate of increase
in the number of ideas diminishes rapidly as the group
grows.21 Beyond a certain point, the greater complexity of
interactions and communication may make it more difficult
for a large group to achieve agreement.
Interactions and communication are much more likely to be
formalized in larger groups. Large groups tend to set agendas for
meetings and to follow a protocol or parliamentary procedure to
control discussion. As a result, time that otherwise might be available to work on tasks is taken up in administrative duties such as
organizing and structuring the interactions and communications
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260
The size of a group may impact the ability of its members to interact with one
another. This group, for instance, is probably too large to function effectively as
a single entity. In all likelihood the group members will form smaller sub-groups,
which some of them seem to be doing.
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
CHAPTER 7 | Groups and Teams
within the group. Also, the large size may inhibit participation of some people and
increase absenteeism; some people may stop trying to make a meaningful contribution and may even stop coming to group meetings if their repeated attempts to contribute or participate are thwarted by the sheer number of similar efforts by other
members. Furthermore, large groups present more opportunities for interpersonal
attraction, leading to more social interactions and fewer task interactions. Social
loafing is the tendency of some members of groups not to put forth as much effort
in a group situation as they would working alone. Social loafing often results from
the assumption by some members that if they do not work hard, other members
will pick up the slack. How much of a problem this becomes depends on the nature
of the task, the characteristics of the people involved, and the ability of the group
leadership to be aware of the potential problem and do something about it.
The most effective size of a group , therefore, is determined by the group
members’ ability to interact and influence each other effectively. The need for
interaction is affected by the maturity of the group, the tasks of the group, the
maturity of individual members, and the ability of the group leader or manager to manage the communication, potential conflicts, and task activities. In
some situations, the most effective group size is three or four; other groups can
function effectively with fifteen or more members.
261
social loafing
The tendency of some
members of groups to put
forth less effort in a group
than they would when
working alone
Group Norms
norm
A standard against which
the appropriateness of a
behavior is judged
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A norm is a standard against whic h the appropriateness of a beha vior is
judged. Thus, norms determine the behavior expected in a certain situation.
Group norms usually are established during the second stage of group devel opment (communication and decision making) and are carried forward into
the maturity stage . By providing a basis for predicting others’ beha viors,
norms enable people to behave in a manner consistent with and acceptable to
the group. Without norms, the activities in a group would be chaotic.
Norms result from the combination of members’ personality characteristics, the situation, the task, and the historical traditions of the group.22 Norms
can be positive or negative for i­ ndividual and organizational outcomes because
group members tend to follow them even if the consequences are
negative. Lack of conformity to group norms
may result in attempts to correct the devi ant behavior, verbal abuse, physical threats,
ostracism, or even ejection from the group .
Group norms are enforced, however, only for
actions that are important to group members.
For example, if the office norm is for employees
to wear suits to convey a professional image to
clients, a staff member who wears blue jeans
and a sweatshirt violates the group norm and
will hear about it quickly. But if the norm is that
dress is unimportant because little contact with
Groups norms reflect standards of behavior that group
members establish for themselves. This group, for example,
likely has norms about appropriate attire--they are each
dressed very similarly to one another.
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PART 3 | Social and Group Processes in Organizations
clients occurs in the office , the fact that someone wears blue jeans ma y not
even be noticed.
Norms serve four purposes in organizations. First, they help the group survive. Groups tend to reject deviant behavior that does not help meet group goals
or contribute to the survival of the group if it is threatened. Accordingly, a successful group that is not under threat may be more tolerant of deviant behavior.
Second, they simplify and make more predictable the behaviors expected of group
members. Because they are familiar with norms, members do not have to analyze each behavior and decide on a response. Members can anticipate the actions
of others on the basis of group norms , usually resulting in increased productivity and goal attainment. Third, norms help the group avoid embarrassing situations. Group members often want to avoid damaging other members’ self-images
and are likely to avoid certain subjects that might hurt a member’s feelings. And
finally, norms express the central values of the group and identify the group to
others. Certain clothes, mannerisms, or behaviors in particular situations may be
a rallying point for members and may signify to others the nature of the group.23
Group Cohesiveness
group cohesiveness
The extent to which a
group is committed to
staying together
Group cohesiveness is the extent to which a group is committed to remaining together; it results from forces acting on the members to remain in the
group. The forces that create cohesiveness are attraction to the group, resistance to leaving the group, and motivation to remain a member of the group.24
As shown in F igure 7.1, group cohesiveness is related to many aspects of
Figure 7.1
The factors that
increase and decrease
cohesiveness and the
consequences of high
and low cohesiveness
indicate that although it is
often preferable to have a
highly cohesive group, in
some situations the effects
of a highly cohesive
group can be negative
for the organization.
Factors That Affect Group Cohesiveness and Consequences of Group
Cohesiveness
Factors That Increase
Cohesiveness
Homogeneous Composition
Mature Development
Relatively Small Size
Frequent Interactions
Clear Goals (Competition or
External Threat)
Success
Consequences of High
Cohesiveness
Goal Accomplishment
Personal Satisfaction of
Members
Increased Quantity and
Quality of Interactions
Groupthink
Factors That Decrease
Cohesiveness
Consequences of Low
Cohesiveness
Heterogeneous Composition
Recent Formation
Large Size
Physical Dispersion
Ambiguous Goals
Failure
Difficulty in Achieving Goals
Increased Likelihood of
Disbanding
Fewer Interactions
Individual Orientation
Lower Commitment to Group
Goals
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CHAPTER 7 | Groups and Teams
group dynamics: maturity, homogeneity, manageable size, and frequency of
interactions.
The figure also shows that group cohesiveness can be increased by com petition or by the presence of an external threat. Either factor can focus
members’ attention on a clearly defined goal and increase their willingness
to work together. Finally, successfully reac hing goals often increases the
cohesiveness of a group because people are proud to be identified with a winner and to be thought of as competent and successful. This may be one reason behind the popular expression “Success breeds success.” A group that is
successful may become more cohesive and hence possibly even more successful. Of course, other factors can get in the way of continued success, such as
personal differences, egos, and the lure of more individual success in other
activities.
Research on group performance factors has focused on the relationship
between cohesiveness and group productivity . 25 Highly cohesive groups
appear to be more effective at ac hieving their goals than groups that are
low in cohesiveness, especially in research and development groups in U.S.
companies.26 However, highly cohesive groups will not necessarily be more
productive in an organizational sense than groups with low cohesiveness. As
Figure 7.2 i­ llustrates, when a group’s goals are compatible with the organi zational goals, a cohesive group probably will be more productive than one
that is not cohesive. In other words, if a highly cohesive group has the goal of
contributing to the good of the organization, it is very likely to be productive
in organizational terms. If such a group decides on a goal that has little to
do with the business of the organization, it will probably work to achieve its
own goal even at the expense of any organizational goals that might compromised by the group’s efforts.
Cohesiveness may also be a primary factor in the development of certain
problems for some decision-making groups. An example is groupthink, which
263
groupthink
when a group’s
overriding concern is
a unanimous decision
rather than critical
analysis of alternatives.
Figure 7.2
Group Cohesiveness, Goals, and Productivity
High
Organizational Productivity
Group goals congruent
with organizational goals
Group goals not congruent
with organizational goals
This figure shows that
the best combination
is for the group to be
cohesive and for the
group’s goals to be
congruent with the
organization’s goals.
The lowest potential
group performance
also occurs with highly
cohesive groups when
the group’s goals are
not consistent with the
organization’s goals.
Low
Low
High
Group Cohesiveness
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264
PART 3 | Social and Group Processes in Organizations
TUULIJUMALA/SHUTTERSTOCK.COM
occurs when a group’s overriding concern is a unanimous decision rather
than critical analysis of alternatives.27 (We discuss groupthink in Chapter 8.)
These problems, together with the evidence regarding group cohesiveness and
­productivity, mean that a manager must carefully weigh the pros and cons of
fostering highly cohesive groups.
Finally, there is emerging evidence that the emotional intelligence of group
members can promote cohesiveness. In this context emotional intelligence refers
U N D E R S TA N D Y O U R S E L F
ARE YOU EMOTIONALLY INTELLIGENT?
Emotional intelligence will help you to be a more effective group and team member, and increase your effectiveness in many other areas as well. The following sixteen
questions will help you to assess yourself on four aspects
of emotional intelligence. Please answer each question
honestly using the following scale. Write the number from
1 to 7 that corresponds to your answer on the scale in the
space to the left of each item number.
slightly
strongly
disagree disagree disagree
1
2
3
neutral
slightly
agree
agree
strongly
agree
4
5
6
7
___ 1.I have a good sense of why I have certain feelings most of the time.
___ 2.I have a good understanding of my own
emotions.
___ 3. I really understand what I feel.
___ 4. I always know whether or not I am happy.
___ 5. I can always distinguish my friends’ emotions
from their behavior.
___ 6. I am a good observer of others’ emotions.
___ 7. I am sensitive to the feelings and emotions of
others.
___ 8. I have a good understanding of the emotions of
people around me.
___ 9. I always set goals for myself and then try my best
to achieve them.
___ 10. I always tell myself I am a competent person.
___ 11. I am a self-motivating person.
___ 12. I would always encourage myself to try my best.
___ 13. I am able to control my temper so that I can handle difficulties rationally.
___ 14. I am quite capable of controlling my own
emotions.
___ 15. I can always calm down quickly when I am very
angry.
___ 16. I have good control of my own emotions.
Scoring and Interpretation: Each score is out of a
maximum score of 28. The accuracy and usefulness of your
score depends on the accuracy of your self-perceptions.
Your self-emotion appraisal score is your total score for
statements 1 to 4: ___
A score above 23 reflects high self-emotion appraisal
and means that you have a good understanding of your
own emotions.
Your others’ emotion appraisal score is your total score
for statements 5 to 8: ___
A score above 22 reflects high others’ emotion
appraisal and means that you are sensitive to what others
are feeling.
Your use of emotion score is your total score for
­statements 9 to 12: ___
A score above 22 reflects high use of emotion and
means that you are able to use your emotions to drive positive behavior.
Your regulation of emotion score is your total score for
statements 13 to 16: ___
A score above 23 reflects high regulation of emotion
and means that you control your emotions effectively.
It is important to remember that the usefulness of
your scores depend on the accuracy of your
self-perceptions.
Source: Reprinted from Wong, C.S. & Law, K.S. (2002). The Effects of
Leader and Follower Emotional Intelligence on Performance and A
­ ttitude:
An Exploratory Study, The Leadership Quar terly, 13(3), 243–274.
­Copyright © 2002, with permission from Elsevier.
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CHAPTER 7 | Groups and Teams
265
to interpersonal capability that includes the ability to perceive and express emotions, to understand and use them, and to manage emotions in oneself and other
people.28 Groups with less well-defined emotional intelligence climates experience increased task and relationship conflict and increased conflict intensity.29
The U.S. Air Force and L’Oreal use emotional intelligence training to improve
team performance. This chapter’s Understand Yourself feature will help you to
evaluate and understand your emotional intelligence skills.
Informal Leadership
RSTOCK
HUTTE
Managers frequently have the opportunity to create
new groups and teams. Given the significant roles
that groups and teams can play in organizational
effectiveness, it its clearly important that this process
ITE/S
STOCKL
CREATING NEW GROUPS
AND TEAMS
informal leader
A person who engages
in leadership activities
but whose right to do so
has not been formally
recognized by the
organization or group
.COM
The final group performance factor is informal leadership. Most functional groups
and teams have a formal leader—that is, one appointed by the organization or
chosen or elected by the members of the group . Because friendship and interest
groups are formed by the members themselves, however, any formal leader must
be elected or designated by the members . Although some groups do designate
such a leader (a softball team may elect a captain, for example), many do not.
Moreover, even when a formal leader is designated, the group or team may also
look to others for leadership. An informal leader is a person who engages in
leadership activities but whose right to do so has not been formally recognized.
The formal and the informal leader in any group or team ma y be the same person, or they may be different people. For example, most groups and teams need
people to play both task and socioemotional roles. An informal leader is likely to
be a person capable of carrying out both roles effectively. If the formal leader can
fulfill one role but not the other, an informal leader often emerges to supplement
the formal leader’s functions. If the formal leader can fill neither role, one or more
informal leaders may emerge to carry out both sets of functions.
Is informal leadership desirable? In many cases informal leaders are quite
powerful because they dra w from referent or expert power . When they are
working in the best interests of the organization, they can be a tremendous
asset. Notable athletes like Peyton Manning, LeBron James, and Abby Wambach are excellent examples of informal leaders. However, when informal leaders work counter to the goals of the organization, they can cause significant
difficulties. Such leaders may lower performance norms, instigate walkouts or
wildcat strikes, or otherwise disrupt the organization.
When new groups are formed, or new members join an existing group, the
group passes through several stages of development. For instance,
this group is welcoming a new member. As they start to work together
the group and its new member will need to spend some time getting to
know each other, defining their expectations of each other, and so forth.
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266
PART 3 | Social and Group Processes in Organizations
be approached logically and rationally. In general, if a new group or team is
being created, managers should be aware of the stages that groups and teams
go through, understand how various performance factors should be considered,
and be aware of the formal process experts suggest for implementing teams.
Stages of Group and Team Development
Groups are not static, and when a new group or team is created it generally
goes through some “growing pains” before it becomes fully functional. Traditional research on small groups per se (as opposed to teams) has focused on
a four-stage development process: (1) mutual acceptance, (2) communication
and decision making, (3) motivation and productivity, and (4) control and
organization.30 The stages and the activities that typify them are shown in
Figure 7.3. We will discuss the stages as separate and distinct. It is difficult
to pinpoint exactly when a group moves from one stage to another, however,
because the activities in the phases tend to overlap.
Figure 7.3
Stages of Group Development
New Group
Formation
Mutual
Acceptance
New Task
New Members
Control and
Organization
Working Interdependently
Assigning Tasks Based
on Ability
Acting Spontaneously
Being Flexible
Self-Correcting
Making Acquaintances
Sharing Information
Discussing Subjects
Unrelated to Task
Testing One Another
Being Defensive,
Quibbling
Motivation and
Productivity
Communication and
Decision Making
Expressing Attitudes
Establishing Norms
Establishing Goals
Openly Discussing
Tasks
Cooperating
Working Actively on
Tasks
Being Creative
This figure shows the stages of evolution from a newly formed group to a mature group. Note that as new members are added
or an existing group gets a new task, the group needs to go through the stages again.
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CHAPTER 7 | Groups and Teams
Mutual Acceptance
In the mutual acceptance stage of group development (also called the
­forming stage), the group forms , and members get to know one another by
sharing information about themselves. They often test one another’s opinions by discussing subjects that have little to do with the group, such as the
weather, sports, or recent events within the organization. Some aspects of
the group’s task, such as its formal objectives, may also be discussed at this
stage. However, such discussion probably will not be very productive because
the members are unfamiliar with one another and do not know how to evalu ate one another’s comments. If the members do happen to know one another
already, this stage may be brief, but it is unlikely to be skipped altogether
because this is a new group with a new purpose. Besides, there are likely to be
a few members whom the others do not know well or at all.
As the members get to know one another , discussion may turn to more
sensitive issues, such as the organization’ s politics or recent controversial
decisions. At this stage, members may have minor arguments and feud a bit as
they explore one another’s views on various issues and learn about each other’s reactions, knowledge, and expertise. From the discussion, members come
to understand how similar their beliefs and values are and the extent to which
they can trust one another. Members may discuss their expectations about the
group’s activities in terms of their previous group and organizational experi ence.31 Eventually, the conversation turns to the business of the group . When
this discussion becomes serious, the group is moving to the next stage of development: communication and decision making.
267
mutual acceptance stage
Characterized by
members’ sharing
information about
themselves and getting to
know each other
Communication and Decision Making
The group progresses to the communication and decision-making stage
(also called storming stage) once group members ha ve begun to accept one
another. In this stage , members discuss their feelings and opinions more
openly, which can increase conflict; they may show more tolerance for opposing
viewpoints and explore different ideas to bring about a reasonable solution or
decision. The membership usually begins to develop norms of beha vior during
this stage. Members discuss and eventually agree on the group’ s goals. Then
they are assigned roles and tasks to accomplish the goals.
communication and
decision-making stage
Members discuss their
feelings more openly and
agree on group goals
and individual roles in the
group
Motivation and Productivity
In the next stage, motivation and productivity (also called the norming stage),
the emphasis shifts away from personal concerns and viewpoints to activities that
will benefit the group. Members perform their assigned tasks, cooperate with each
other, and help others accomplish their goals. The members are highly motivated
and may carry out their tasks creatively. In this stage, the group is accomplishing
its work and moving toward the final stage of development.
motivation and
productivity stage
Members cooperate, help
each other, and work
toward accomplishing
tasks
Control and Organization
In the final stage , control and organization (also called the performing
stage), the group works effectively toward accomplishing its goals. Tasks are
assigned by mutual agreement and according to ability. In a mature group ,
the members’ activities are relatively spontaneous and flexible rather than
subject to rigid structural restraints. Mature groups evaluate their activities
and potential outcomes and take corrective actions if necessary. The characteristics of flexibility, spontaneity, and self-correction are very important if the
group is to remain productive over an extended period.
control and organization
stage
The group is mature;
members work
together and are
flexible, adaptive, and
self-correcting
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268
PART 3 | Social and Group Processes in Organizations
Not all groups, however, go through all four stages. Some groups disband
before reaching the final stage. Others fail to complete a stage before moving
on to the next one. Rather than spend the time necessary to get to know one
another and build trust, for example, a group may cut short the first stage of
development because of pressure from its leader, from deadlines, or from an
outside threat (such as the boss).32 If members are forced into activities typical
of a later stage while the work of an earlier stage remains incomplete, they are
likely to become frustrated: The group may not develop completely and may be
less productive than it could be.33 Group productivity depends on successful
development at each stage. A group that evolves fully through the four stages
of development usually becomes a mature, effective group.34 Its members are
interdependent, coordinated, cooperative, competent at their jobs, motivated
to do them, self-correcting, and in active communication with one another.35
The process does not take a long time if the group makes a good, solid effort
and pays attention to the processes.
Finally, as working conditions and relationships change, either through a
change in membership or when a task is completed and a new task is begun,
groups may need to re-experience one or more of the stages of development to
maintain the cohesiveness and productivity characteristic of a well-developed
group. The San Francisco Forty-Niners, for example, once returned from an
NFL strike to an uncomfortable and apprehension-filled period. Their coach
conducted rigorous practices but also allowed time for pla yers to get together
to air their feelings. Slowly, team unity returned, and players began joking and
socializing again as they prepared for the rest of the season.36 Their redevelopment as a mature group resulted in two subsequent Super Bowl victories.
Although these stages are not separate and disti nct in all groups, many
groups make fairly predictable transitions in activities at about the mid point of the period a vailable to complete a task. 37 A group may begin with
its own distinctive approach to the problem and maintain it until about half way through the allotted time. The midpoint transition is often accompanied
by a burst of concentrated activity, reexamination of assumptions, dropping
old patterns of activity, adopting new perspectives on the work, and making
dramatic progress. Following these midpoint activities, the new patterns of
activity may be maintained until close to the end of the period allotted for the
activity. Another transition may occur just before the deadline. At this transition, groups often go into the completion stage, launching a final burst of activity to finish the job.
process gain
Performance
improvements that occur
because people work
together rather than
independently
process loss
Performance decrements
that occur when a team
performs worse than
the individual members
would have if they had
worked alone
Understanding Team Performance Factors
People working together in teams ha ve the potential to produce more or
higher-quality outputs than would ha ve resulted if the individual efforts of
team members were later combined. Process gain refers to the performance
improvements that occur because people work together rather than independently. Process gain is the goal of working in teams—people working together
doing more and doing it better than would be possible working alone.
Unfortunately, many teams do not realize process gain and instead expe rience process loss. Process loss occurs when a team of people working in a
group or team together performs worse than the individual members would
have if they had worked alone . Process loss can be reduced by making c lear
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CHAPTER 7 | Groups and Teams
role and task assignments and not tolerating free riders . Free riders do not
contribute because they rely on the work of others . Paying attention to how
a team does its work can help you to identify and remedy many of the factors
contributing to process loss. The likelihood of process gain can be improved by
awareness of several team performance factors. Some of these relate closely to
the group performance factors noted earlier, while others are extend beyond
those factors.
One useful technique for promoting process gain is to develop and promote team efficacy. Team efficacy is a team’s shared belief that it can organize and execute the beha viors necessary to reach its goals.38 Team efficacy
is strongly related to team performance, particularly when team interdependence is high.39 Team efficacy can be enhanced by ensuring that at least some
members of a team have strong self-efficacy themselves, that team members
are given appropriate support and training, and by expressing confidence in
and providing encouragement to the team.
As we noted earlier, members of a highly cohesive team are motivated to
stay in the team, contribute as much as they can, and conform to team norms.
Because members of teams that lac k cohesiveness are not strongly commit ted to the team or its goals and do not contribute to their full potential, team
performance is compromised.40 Therefore, managers of new groups and teams
should strive to promote cohesiveness.
Managers should also try to build trust among team members.Trust is our
confidence that other people will honor their commitments, especially when it
is difficult to monitor or observe the other people’ s behavior. 41 Teams build
trust through repeated positive experiences, commitment to shared goals, and
an understanding of team members’ needs , motives, and ideas. Because the
lack of trust in a team can undermine any team activity, building trust is an
important managerial task. Giving frequent task feedback and interpersonal
contact can help diverse teams utilize their diversity to their advantage and
create process gain.42
Managers should also try to prevent social loafing. Indeed, social loafing is
a primary cause of process loss. Research has documented the common practice of social loafing,43 particularly for trivial to moderately important tasks.
Social loafing is less common with very important tasks ,44 and with smaller
teams.45 Social loafing often occurs because team members feel that their individual contributions will not be evaluated or because they expect others in the
team to do tasks so they choose not to do them.46
An opposite behavior occurs when people actually work harder and are
more motivated when others are present than when they are working alone .
Social facilitation happens when people are motivated to look good to oth ers and want to maintain a positive self-image. It happens when people are
working alone, but in the presence of an audience. People sometimes increase
their effort when working in a group simply because others are present 47 or
because of evaluation apprehension.48
Keeping team size small, clarifying what the team expects eac h member
to do, and making individual contributions to the team identifiable can help
reduce social loafing and encourage social facilitation. 49 For example, giving
a team member the responsibility for ensuring that meeting notes are shared
with the team within two days of a meeting makes it more likely that notes will
be taken and distributed. Letting team members choose which tasks they will
be responsible for can also increase their motivation for getting them done.
269
team efficacy
A team’s shared belief
that it can organize and
execute the behaviors
necessary to reach its
goals
trust
Confidence that other
people will honor their
commitments, especially
when it is difficult to
monitor or observe the
other people’s behavior
social facilitation
Happens when people
are motivated to look
good to others and want
to maintain a positive
self-image
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
270
PART 3 | Social and Group Processes in Organizations
roles
Define the behaviors and
tasks each team member
is expected to perform
because of the position
they hold
In addition, managers should establish clear roles. Roles define the
behaviors and tasks eac h team member is expected to perform because
of the position they hold. One of the primary outcomes of the process of
group and team development is the establishment of clear roles in the team.
Understanding what your teammates expect you to do and what you can
expect your teammates to do reduces conflict and enables smooth team performance. Making team roles and expectations clear helps to reduce process
loss.
It is also important to establish positive norms. By helping team members
know what to expect from each other, norms help to ensure high performance.
An example of a positive team norm is arriving to meetings prepared and on
time, and participating fully. Team members comply with team norms (1) to
avoid punishments and receive rewards; (2) to imitate team members whom
they like and admire; and (3) because they have internalized the norm and
believe it is the appropriate way to behave.50
When possible, managers should create shared team goals and provide
feedback. High-performing teams ha ve clear and challenging goals that all
team members are committed to, and create sub-goals and milestones against
which they measure themselves. If performance is lagging, feedback helps the
team quickly adjust its beha vior and processes to reach its goals.51 As featured in this chapter’s real world response, in South Korea, Starbucks created
shared team goals around tasks typically performed by females to encourage
its male employees to perform these tasks as well.52
Team rewards also motivate effective teamwork beha viors. Tying team
rewards to team performance motivates team members to pursue team goals
rather than individual goals.53 Teams require firms to shift the emphasis of
their compensation and rewards programs from individual to team rew ards.
Any remaining individual rewards should acknowledge people who are effective team players—people who freely share their expertise, help when needed,
and challenge their teams to improve. A “star” system that rewards only individual performance undermines team effectiveness.
Some individual rewards may be appropriate for those who make partic ularly critical individual contributions to the team, but the bulk of rew ards
need to be made at the team level. Managers should remember the importance
of integrating new team members. Team member turnover compromises team
effectiveness as new members must be proactively integrated and socialized.54
Leaders are critical to this newcomer integration and socialization process.
New team member integration involves motivating all team members by promoting shared goal commitment, positive affect, and shaping team processes.
Team socialization creates affective bonds that connect members to the team
and its mission, and helps build trust and a sense of community . If current
team members do not take the time to incorporate new members into the fabric of the team, the team will be less cohesive, new members will not be able to
contribute to their full potential, and new members are likely to be less com mitted to the team.
The Implementation Process
Implementing teams across an organization is not easy; it takes a lot of
hard work, time, training, and patience. Indeed, changing from a traditional
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CHAPTER 7 | Groups and Teams
271
organizational structure to a team-based structure is a major organizational
change and calls for a complete cultural c hange for the organization. Typically, the organization is hierarc hically designed to provide c lear direction
and control. However, many organizations need to be able to react quic kly to
a dynamic environment. Team procedures artificially imposed on existing processes are a recipe for disaster. In this section we present several essential
elements peculiar to an organizational change to a team-based situation. This
process is shown in Figure 7.4.
Phase 1: Start-Up
In phase 1, team members are selected and prepared to work in teams so that
the teams have the best possible chance of success. Much of the initial training is informational or “awareness” training that sends the message that top
management is firmly committed to teams and that teams are not experimental. The steering committee usually starts the training at the top , and the
training and information are passed down the c hain to the team members .
Figure 7.4
Phases of Team Implementations
Phase 5:
Self-Managing
Teams
Phase 4:
Tightly Formed
Teams
Implementation of teams
in organizations is a long
and arduous process.
After the decision is
made to initiate teams,
the steering committee
develops the plans for
the design team, which
plans the entire process.
The goal is for teams to
become self-managing.
The time it takes for each
stage varies with the
organization.
Phase 3:
Leader-Centered
Teams
Phase 2:
Reality & Unrest
Phase 1:
Start-Up
Plan the
Implementation
Make the Decision
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Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.
272
PART 3 | Social and Group Processes in Organizations
Training covers the rationale for moving to a team-based organization, how
teams were selected, how they work, the roles and responsibilities of teams,
compensation, and job security. In general, training covers the technical skills
necessary to do the work of the team, the administrative skills necessary for
the team to function within the organization, and the interpersonal skills
necessary to work with people in the team and throughout the organization.
Sometimes the interpersonal skills are important. Perhaps most important
is establishing the idea that teams are not “unmanaged” but are “differently
managed.” The difference is that the new teams manage themselves . Team
boundaries are also identified, and the preliminary plan is adjusted to fit
the particular team situations. Employees typically feel that much is changing during the first few months; enthusiasm runs high, and the anticipation
of employees is quite positive . Performance by teams increases at start-up
because of this initial enthusiasm for the change.
Phase 2: Reality and Unrest
After perhaps six to nine months, team members and managers report frus tration and confusion about the ambiguities of the new situation. For employees, unfamiliar tasks, more responsibility, and worry about job security replace
hope for the opportunities presented by the new approac h. All of the train ing and preparation, as important as it is, is never enough to prepare for the
storm and backlash. The Cummins Engine Company held numerous “prediction workshops” in an effort to prepare employees and managers for the
difficulties that lay ahead, all to no a vail. Its employees reported the same
problems that employees of other companies did. The best advice is to perform
phase 1 very well and then make managers very visible , continue to work to
clarify the roles and responsibilities of everyone involved, and reinforce the
positive behaviors that do occur.
Some managers make the mistake of staying completely away from the
newly formed teams, thinking that the whole idea is to let teams manage
themselves. In reality, managers need to be visible to provide encouragement, to
monitor team performance, to act as intermediaries between teams, to help
teams acquire needed resources, to foster the right type of communication, and
sometimes to protect teams from those who want to see them fail. Managers,
too, feel the unrest and confusion. The change they supported results in more
work for them. In addition, there is the real threat, at least initially, that work
will not get done, projects may not get finished, or orders will not get shipped
on time and that they will be blamed for the problems.55 Managers also report
that they still have to intervene and solve problems for the teams because the
teams do not know what they are doing.
Phase 3: Leader-Centered Teams
As the discomfort and frustrations of the previous phase peak, teams usually
long for a system that resembles the old manager-centered organizational
structure (see Figure 7.4). However, members are learning about self-direction
and leadership from within the team and usually start to focus on a single
leader in the team. In addition, the team begins to think of itself as a unit as
members learn to manage themselves. Managers begin to get a sense of the
positive possibilities of organizing in teams and begin to withdra w slowly
from the daily operation of the unit to begin focusing on standards , regulations, systems, and resources for the team. 56 This phase is not a setbac k to
team development—although it may seem like one—because development of
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